PALM OIL EXPORTS From Indonesia Set to Advance on Ramadan
Rabu, 04 Juli 2012 | 13:22
Palm-oil shipments from Indonesia, the world\'s largest producer, may climb 9.5% in June on sustained demand before the Muslim fasting month of Ramadan.Exports are set to climb to 1.5 million metric tons from 1.37 million tons in May, while output will probably be little changed at 2.1 million tons, according to the median of five plantation and refining company executives in a Bloomberg News survey. Inventory will also be little changed at 1.85 million tons, two of the respondents said.
Futures lost 17% from a 13-month high in April as the debt crisis in Europe and the slowing economy in China, the largest cooking-oil user, reduced demand, potentially limiting costs for Nestle SA, the world's largest foodmaker, and curbing revenues at PT Astra Agro Lestari and Golden Agri-Resources Ltd., the second-biggest grower.
"Global demand, either from India or other countries, will usually increase by 15% to 20% during the festive seasons," said Derom Bangun, a deputy chairman at the Indonesian Palm Oil Board, a group of growers and refiners.
"This will support prices even as the pressure from the European crisis is still quite strong."
The holy month of Ramadan starting this year in late July is a time when consumption of cooking oil usually climbs as followers break daylong fasts with communal meals. The Eid al- Fitr festival marks the end of fasting.
Indonesia exported 1.37 million tons of palm oil last month, a 1.4% drop from April, according data from the Indonesia Palm Oil Association.
That was lower than the median estimate of 1.63 million tons from four companies in a Bloomberg survey published May 31.
Palm oil lost 12% this quarter and is set for its worst performance since the period ended March last year. September-delivery futures gained 0.7% to 3,020 ringgit a metric ton on the Malaysia Derivatives Exchange today. Soybean oil has declined 5% this quarter.