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India, biofuels will help palm oil sizzle
Our Bureau
Date of posting: 14-03-07
      Palm oil prices are set to jump more than 20 percent by year-end as global oilseed stocks get depleted and demand from the food and fuel sectors surges, industry officials said during the annual palm oil conference in the Malaysian capital. Malaysian palm, which gained almost 40 percent last year, could move slightly downward in the near term, but surging Indian food demand and Europe's insatiable appetite for biofuels will ensure the commodity holds on to the gains this year.

      According to Mistry, a director of Indian firm Godrej International Ltd., palm oil would trade in the range of 2,200-2,400 ringgit per tonne by the fourth quarter of 2007. The market could climb to 2,200 ringgit as early as July. But some analysts said palm oil could come under pressure in the next few months as soybean and palm oil stocks were at comfortable levels.

      Othes see oilseed stocks falling next year as smaller crops force users to draw down stocks. Thomas Mielke of Hamburg-based Oil World sees a possibility of some downward pressure on prices in the next one or two months.

      India is expected to buy 6.3 million tonnes of edible oil in the year to October 2007, up from 5.4 million tonnes a year ago. Import duty on crude palm oil is 60 percent and refined palm oil is 67.5 percent.

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