Athena Market Buzz

1320 01032023 Athena Market Buzz Wednesday 

Greetings,

China's economy has shown a robust recovery as the era of zero COVID cases comes to an end. The growth in the manufacturing and housing markets is expected to have a positive impact on the consumption of agricultural commodities as well. The recovery has surpassed expectations, leading to crude oil Brent jumping to around $84 a barrel, and Palm oil MDEX also opened firm, settling at RM 4177+35 by lunch, which is almost at the day's high at RM 4196+54 as of writing this report. Although overall sentiments are low, demand is improving. Despite concerns about inflation, war, and a global slowdown, worries about increasing food demand, rising sea freight, high temperatures damaging standing crops in India and Argentina, floods in Malaysia, and countries limiting exports to protect their own population may limit the downside.

Currently, prices between RM 4250 to RM 4450 can be used to short, and prices between RM 3750-3850 can be used to buy back shorts. For making pure longs, one can accumulate oils around the 3450-3650 levels. The next ten days show heavy rain forecasts, and some parts are already flooding, which may push the market to test RM 4250 today itself. Therefore, we suggest our readers watch the weather carefully. Locally in India, ROL prices are trading between INR 945/950, while CNF CPO was indicated between 1030-1035 PMT.

Bean oil settled marginally lower last night with March at 59.75-29 and May at 60.04-30, while the basis was mostly unchanged, making Flat price bean oil unchanged as well. Forwards are not coming down, and we are seeing firming up for MJJ months. Demand from destination countries like India and China is expected to rise in the summer months, but if the heat waves are too intense, we may see lower consumption of soft oils. Currently, offers for MJJ to India have increased to just about USD 1188-1190, mostly at par with CNF Sunflower oil offers. Americans are publicly voicing against sending money to Ukraine, and this could mean that we may see some solution to current conflicts, but only by June/July of this year. Things may get worse before they get better, hence destinations like India and China should continue their purchases from origins like the US and Argentina. Today, CNF India's offers were indicated for MJJ at 1190, and buyers still wait for prices to come between 1100-1150 to make longs. On the upside, it will be challenging for Bean oil to rally beyond the USD 1350 mark, at least till MJJ.

Ukraine is currently seeking additional funding and weapons, while some American citizens have voiced their concerns on social media regarding further aid to Ukraine. It remains to be seen how this situation will develop.

Meanwhile, Ukraine is anticipating another 1.2 million MT of sunflower oil exports amidst dry weather conditions caused by heat waves in Europe. As we move towards the new crop, prices are expected to rise due to a combination of factors, including the ongoing conflict and reduced acreage, along with poor weather that is likely to result in a lower crop yield for the 2023-2024 campaign in Ukraine and Russia.

India has recently lifted the TRQ on sunflower oil, which is expected to benefit local farmers who are currently selling rape seeds at MSP. This may lead to an increase in spot sunflower oil loading demand but could also put more pressure on FOB Black Sea loading for AMJ. Imports with a BL date prior to March 31st can still take advantage of the benefits, which could lead to a faster depletion of local oil stocks. Restrictions on vessel age lower than 25 years may also increase freight rates, thus placing additional pressure on origins.

We advise our readers to maintain long positions as we expect import levels to reach 150,000 MT for February and relieve some pressure by the end of March. Prices are expected to find support in the range of USD 1100-1150 and resistance is likely to be encountered around USD 1400-1450 MJJ. By MJJ, we anticipate sunflower oil to trade at a premium to bean oil, with premiums expected to be around USD 100 PMT on the upper end.







  • ARG SBO
  • Mch -820K vs -940K
  • Apr -1000 vs -1100
  • MJJ -1050 vs -1150
  • BR SBO
  • Mch -800 vs -1020
  • Apr -980 vs -1070
  • May -1050 vs -1170
  • JJ -1020 vs -1170
  • AS –980 vs -1100
  • OND – vs -1050
  • 6 ports Europe previous close Spot 1165 vs 1155
  • AMJ1170 vs 1160
  • JAS 1185 vs 1170
  • OND 1180 vs 1160
  • Palm oil Midday Market Close 
  • Bmd : May 4177 (+35)
  • H 4196 / L 4141
  • Vol :  20,969
  • Oln:  
  • Mar 980 (pk) vs 
  • Amj 980 vs  970
  • Jas 970/67.5 vs 962.5 trd 965
  • Ond 957.5 vs 950
  • Rbdpo: -10
  • Strn: Mar 947.5 (deld) 
  • Pfad: Mar 720 (deld)
  • Local Cpo: Mar 4250
  • Laurics:
  • Cpko: Mar 243 (pk) / 243 (pg)
  • Rbdpko: Mar 1040
  • Rbdpkoln: Mar 960
  • Rbdpks: Mar 1390
  • Sbo :  
  • Mar 6052 (+77)
  • May 6080 (+76)
  • Jul 6041 (+66)
  • Dce :  
  • May 8238 (+16)
  • Sep 8052 (unch)
  • Black Sea sunflower oil FOB indicative only 1050 vs—
  • Russian sunflower oil indicated at USD 1045 vs —
  • Spain indicated March at USD 1175 vs —
  • Italy indicated April at USD 1175 vs —
  • CIF LW India indications for April loading at USD 1185 v —
  • Turkey not offered at the moment 
  • Currency INR 82.52, Rm 4.48, Rub 75.08 and Euro 1.0596




Vivek Pathak 

Athena Tradewinds 

(All views are personal and we do not claim to be 100 % correct. Trade very carefully and at your own risk) 

++++++++++++++++++++++++++++++++++


Popular posts from this blog

Athena Market Buzz

1430 07082024 ATHENAMARKETBUZZ WEDNESDAY Good Morning, **MDEX Markets:** Equity markets have been quite volatile, with Japan leading the fluctuations. After significant losses, the market rebounded yesterday and partially today. However, MDEX performed as anticipated, dropping below the RM 3750 mark. Traders might misinterpret this and suggest short positions or exiting longs. Previously, we recommended entering long positions between RM 3550-3650 and exiting between RM 3950-4000. Now, we suggest initiating longs between RM 3650-3750 and exiting around RM 4000. Currently, October contracts are trading at RM 3695-10, near the day's low. Given the global tensions and unstable business environment, commodities may become a new hard currency. Shorting at RM 4250 and above seems safe for now, but we will reassess as conditions evolve. **Palm Oil CASH Market:** CNF India traded several times yesterday for ROL between USD 940-92.50, and today sellers are around USD 940, but buyers are hes...
Read more

Athena Market Buzz Friday

1400 27012023 Athena Market Buzz Friday  Mdex opened firm and as expected jump from 3750 is targeting RM 4000 on the upside where it may feel some more resistance. At lunch MDEX settled at RM 3857 +1.9% and at the time of writing this report is also trading around there only. Exports are slowly picking up and the loss of export will be lesser as we look at 1-31 Jan export numbers. We expect today the markets to remain firm and with some more strength coming in soft oils flat price we could attempt to touch RM 3900 today or early next week. Over all view is same  a maximum 10% downside risk around RM 3750 with a potential of 20% jump eventually. We would suggest our readers to make longs between RM 3450-3750 and sell it once we cross RM 4000 . Be ready to short the market once we cross RM 4250-4450.  CPO prices to India are maintained at USD 995-1005 and we expect it to find decent support here. Locally ROL is trading in India at 900 and we heard some business WCI already....
Read more

AthenaBUzz

1530 14092023 Athena Market Buzz Thursday  Good Afternoon, India imported over 295,000 mt of sunflower oil in the month of Aug and we expect that the imports for Sept will be in excess of 250,000 MT again pushing the 6 monthly imports to around 1.7 million MT. These are high numbers and it appears that the demand for sunflower oil will continue to rise with the current discounts and in next 6 months India may end up importing another 2 million MT of sunflower oil making yearly total to 3.5 Million MT for April 2023-March 2024. The excess oil is basically imported by  Kandla based traders who do not won Refinary and cumulatively this is about 300,000 mt. in past 5 months. Ukraine sunflower oil is getting aggressively offered to India at USD 865/870 , CIF Marmara we heard trades at USD 775 and Mersin traded at USD 780 today the offers are about USD 10 higher but we expect the same prices to trade again. India too bought some volume about 18,000 mt in east coast at USD 860 with f...
Read more