Chronicle of raw materials
Palm oil: a booming market
Audio 01:34
Palm oil is once again making headlines.
This new jump on the markets follows the Indonesian decision to suspend its exports to stabilize the domestic price of oil, also widely consumed locally.
Getty Images/CollinsChin
By: Marie-Pierre Olphand Follow
2 mins
The mad rush of palm oil prices continues.
Indonesia's decision to suspend its exports has put further pressure on an already tight edible oil market.
Advertisement
1,800 euros per tonne delivered to the port of Rotterdam, one of the reference ports for price fixing, ie 200 euros more than two weeks ago, and more than 600 euros since the beginning of January!
Palm oil is once again making headlines.
This new jump on the markets follows the Indonesian decision to suspend its exports to stabilize the domestic price of oil, also widely consumed locally.
However, Indonesia accounts for more than half of world exports.
The market could hardly not react.
"
This is the perverse effect of export bans
", comments an expert, "
the measure relieves locally, but weighs internationally
".
Prices marked by the cessation of Indonesian exports
Jakarta's decision is tentative and is expected to be lifted at the end of May.
According to calculations by the analysis firm Agritel, the one-month export freeze is equivalent to 1.7 months of domestic consumption and should therefore be enough to bring down prices locally.
Beyond that, the archipelago could be confronted with storage problems, because the essence of oil palm is to produce continuously.
On the buyers' side, the measure which for the moment can be compensated by stocks, would become problematic, if the blockage were to continue.
Oil market imbalance is accelerating
With this new surge in palm oil, all edible oils go hand in hand.
The market is all the more tense as since the war in Ukraine, the market has been deprived of the leading exporter of sunflower oil, for an indefinite period.
With exports stopped in Ukraine and Indonesia, 40% of world trade is closed, all oils combined.
"
And the volumes of substitution do not exist elsewhere, there is no surplus
", specifies Sébastien Poncelet, director of development within the firm Agritel.
The market has been hypertensive for at least two years, he recalls, with deficits in the palm, rapeseed and soybean sectors, linked in particular to repeated climatic problems.
Newsletter
Receive all the international news directly in your mailbox
I subscribe
Follow all the international news by downloading the RFI application
google-play-badge_EN
Indonesia
Agriculture and Fishing
Trade and Exchanges