Oct. 16 (Bloomberg) -- Palm oil prices may rebound “in the medium term” as consumer demand increases after prices dropped, Oil World said.
World palm oil exports may total 42.57 million metric tons in the 2012-13 season that began Oct. 1, up 5.8 percent from 40.24 million tons a year earlier, the Hamburg-based researcher said today in an e-mailed report. Combined exports of soybean oil, rapeseed oil and sunflower seed oil may be 19.12 million tons, 5.4 percent smaller than a year earlier, Oil World said.
Palm oil futures have dropped 23 percent this year on the Malaysia Derivatives Exchange, touching 2,230 ringgit ($729) a ton on Oct. 3, the lowest for a most-active contract since November 2009. Soybean oil touched the highest price in a year on Sept. 4 on the Chicago Board of Trade, as drought in the U.S. threatened yields. Both commodities are used for cooking.
“Palm oil has significantly improved its price competitiveness in the food sector with record discounts relative to soya oil,” Oil World said. “Consumers will probably take advantage of the current attractive palm oil prices, which are below the fundamentally justified level, while exporters are ready sellers owing to their currently unusually large stocks.”
World production of palm oil may total 52.28 million tons this year, up 3.7 percent from 50.42 million tons in 2011, Oil World said. Output in Indonesia, the world’s biggest producer, may rise to 26 million tons, up 8.3 percent from 24 million tons in the previous season. The harvest in Malaysia may drop to 18.47 million tons, down 2.3 percent from 18.91 million tons.
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