Special Market Update
Grain Market Commentary
Monday, July 10, 2017
By Risk Management, The Andersons
Fundamental story behind Palm and Bean oil the real strength of the soy complex.
Veg Oils have taken a back seat as US heat has dominated the headlines recently, but last night the Malaysian Palm Oil Board released some bullish stats that could keep feeding one of the more bullish fundamental balance sheets in the Ag industry.
Palm production during June was reported at 1.514mmt, approx 155k tonnes below the average trade guess, production was down 1.2% relative to last year, USDA expects production to expand 10.2% making the Veg Oils very tight globally as it appears the USDA will need to lower production significantly. On the demand side of the equation palm oil use during June was up 11% year over year making it pretty clear how the supply and demand situation is becoming tighter and tighter. Palm Oil ending stocks have been the lowest in years making the Veg Oil story desperate for higher prices to ration demand and bring more production online in the coming months.
Malaysian palm oil up seven percent in 8 days.