Athena Buzz

1420 04102023 Athena Market Buzz Wednesday 


Good Afternoon,


Mdex started the day with a slight positive tone, and by lunchtime, we saw a 0.4% increase for the December contract, reaching RM 3727. However, at the time of writing this report, it is trading relatively flat at RM 3719, up by 11 points. As previously noted, we maintain our bearish outlook until we witness the market closing above RM 3750 for two consecutive sessions. Palm oil is currently on a downward trajectory, aiming to find support around RM 3450 before potentially rallying once more. Our recommendation to readers is to wait for prices to correct towards RM 3550-3450 before considering long positions. Short positions can be considered if prices surpass the RM 4250 mark. The current market range is suitable for long liquidation but not for hedging existing long positions.


In terms of CNF India offers, Crude Palm Oil (CPO) is priced around USD 870, while Refined, Bleached, and Deodorized (ROL) palm oil is offered at USD 855, which is only USD 15 lower. We have observed more substantial discounts previously, and we anticipate further widening of this discount. Locally, ROL is being offered at INR 81,000, close to the import parity of INR 83,000. Disparity has decreased, and with upcoming festive demand for ROL and other oils, we expect the lower end of the MDEX to be supported at RM 3450. However, factors such as a strong US dollar, global economic concerns, and the ongoing supply of affordable sunflower oil to India will likely restrain any significant rally, providing opportunities to trade within the range.


CBOT settled with a slight negative tone last night, with December down by 30 points at 57.13 and January down by 37 points at 56.31, maintaining the downward trend. The strength of the US dollar and global economic uncertainties make it challenging for bean oil to remain strong. Our view is that bean oil prices should gradually move towards 54.50, with the basis staying at around -1500, pushing FOB prices toward 870 and CIF India prices toward 950, which is currently indicated around USD 1000. Bean oil is facing tough competition from sunflower oil, and a correction in prices seems inevitable. India is on the verge of harvesting a substantial crop, and although there won't be a perfect match in the crush, some oil will become available for the domestic market. This will prompt port plants to import and operate again, leading to a significant disparity. The cost of replacing degummed soybean oil today stands at INR 91,000, while sellers are indicating INR 84,000 plus GST, resulting in a replacement loss of INR 7,000 or USD 84 per metric ton. We suggest that refineries at the port avoid importing degummed soybean oil and consider covering their partial needs with locally sourced oil or imported oil with disparities. Imports may only be considered in November.

Black Sea sunflower oil is encountering some resistance, with prices to Europe now indicated at USD 920. In contrast, India has priced some cargo at USD 900-910, and current offers are hovering around USD 915. Ukraine has completed approximately 70% of its harvest, and the current crop is estimated to exceed 14.0 million metric tons, possibly even higher. This surplus is likely to exert pressure on prices, especially in October, November, and December (OND). We advise our readers to wait until prices correct below the USD 880 CIF India mark before considering long positions. European rape seed oil prices are nearly on par with bean oil, with sunflower oil remaining the most economical option, making it a preferred choice. Indications for sunflower oil in Spain are around USD 920, compared to rape seed prices of around 1015 and bean oil prices in a similar range.

  • Argentina SBO
  • Oct 23 -1550/-1620
  • ND 23 -1530/-1600
  • MJJ 24 -1500/-1700
  • Brazil SBO
  • Nov 23 -1500/-1650
  • Dec 23 -1480/-1630
  • AM 24 -1500/-1720
  • JJ 24 -1520/-1780
  • 6 ports Europe SFO 
  • Oct   $920 vs $870
  • ND    $920 vs $870
  • JFM  $935 vs $870
  • AMJ  $940 vs $875
  • Palm oil Midday Market Close 
  • Bmd : Dec 3727 (+19)
  • H 3732 / L 3688
  • Vol :  19,459
  • Oln  
  • Nov 827.5 vs
  • Dec 837.5 vs
  • Jfm 850 vs 842.5
  • Amj 857.5 vs 850
  • Jas 850 vs 840
  • Rbdpo: -5
  • Strn: Oct 767.5 (deld) 
  • Pfad: Oct 767.5 (deld)
  • Local Cpo: Oct 3700
  • Laurics
  • Cpko: Oct 229 (pk) / 229 (pg)
  • Rbdpko: Oct 890
  • Rbdpkoln: Oct 850
  • Rbdpks : Oct 1010
  • Sbo :  
  • Oct 6012 (+67)
  • Dec 5729 (+16)
  • Jan 5639 (+8)
  • Dce :  closed
  • Black Sea sunflower oil FOB indications 770 vs 750
  • Russian sunflower oil FOB indicatively USD 770 vs —
  • Spain offered for Nov at USD 920 vs 890
  • Italy offered for Nov at USD 915 vs —
  • CIF Lw India indications around USD 915 vs 905 ( may trade higher)
  • Turkey not offered at the moment
  • Currency INR 83.22, RM 4.73, Euro 1.046 and rub 99.31


Thanks and regards


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)


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