Oil World Believes Palm Oil Prices Will Remain High

HAMBURG: Global palm oil prices are likely to remain high in

coming months despite recent weakness, Hamburg-based oilseeds analysts

Oil World forecast yesterday.

“Palm oil prices will indeed be

supported in the next four to six months, considering that soyaoil

supplies are still tight in South America, sun oil supples are becoming

increasingly scarce and the production prospects for palm oil are at

least uncertain,” it said.

Unusually large palm tree

replantings in Malaysia will reduce the area of mature productive trees

while the El Nino weather pattern could damage Asian palm production,

it said.

Global soyaoil supplies are still tight following poor

South American soyabean crops in early 2009 while a large rise in

sunflower oil crushings following a poor crop is likely to cut stocks.

Malaysian crude palm oil futures have dropped after

hitting a seven-month high on January 5, dragged down by

bigger-than-expected stock levels in December, weaker exports in the

first 10 days of January and fears of reduced China buying. But the

long-term outlook was still for firm palm prices and this was

increasingly being realised, it said. – Reuters

Source : Business Times

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