Athena Market Buzz

1530 29012024 Athena Market Buzz Monday 


It touched RM 4000 and then we are seeing some consolidation. 


MDEX commenced its session on a downward trajectory, and by midday, the prevailing trend remained predominantly negative. April contracts observed a decline of 52 points, settling at RM 3965, while May contracts experienced a 39-point decrease, reaching RM 3920. Previous indications of resistance near RM 4000 have materialized, prompting profit-taking and long liquidation, thus nudging prices slightly below the RM 3850 to RM 3750 range. These levels are anticipated to attract buying interest, fostering a potential market rebound toward RM 4250, where we recommend readers consider initiating short positions.

Palm oil continues to chart its course independently, exhibiting a premium over soft oils, particularly until March 2024, despite the seemingly advantageous pricing of soybean oil. Factors such as excessive rainfall potentially constraining production in January and subdued demand from key markets like China and India are expected to exert downward pressure on prices. We strongly caution against spread trading strategies involving buying soybean and selling palm oil.

Amid corrections, palm oil remains an attractive buy, with support levels around RM 3450 expected to endure until June 2024. Conversely, formidable resistance is anticipated around RM 4450, with the RM 4250-4450 range serving as an opportune zone for short positions, long exits, and soft oil hedging.

RBD Palm Olein (ROL) opened to offers at USD 910, while Crude Palm Oil (CPO) saw openings around USD 930. Disparities in local markets are evident, with a USD 30 gap between indicative INR rates for ROL and actual replacement costs.

CBOT soybean oil closed marginally higher on Friday, with May settling at 47.46 (+38) and July at 47.66 (+32). However, soybean futures faced downward pressure, primarily due to optimism surrounding Brazil's robust crop forecasts. At present, soybeans are trading near yearly lows, hovering below 12.00, with hopes pinned on finding support around 11.5. This scenario bodes well for oil shares, with soybean oil likely to reclaim its support at 47.50, although March futures currently indicate a decline to 46.51.

Degummed soybean oil emerges as the most competitively priced option for India, priced at USD 910 for April and May deliveries. Below USD 900 for the MJJ period, long positions may be considered, while Indian domestic markets exhibit subdued activity amid disparities and tepid demand.

The Black Sea sunflower oil market opened quietly today, with prices to Spain at USD 945 and Italy at USD 940, though buyers are reluctant to surpass USD 900. FOB prices in Romania hover around 850, with Ukrainian cargoes in Danube priced at approximately 830, translating to Turkish market rates of about USD 885 in Mersin and USD 860 in Izmir. CIF India, sellers are seeking to price nearby cargoes at USD 935, with forward-month expectations below USD 925, owing to shipment delays and tight market conditions in India. We advise against short positions on sunflower oil, advocating for maintaining ready stocks alongside replacements, with long positions advisable if forward prices dip below USD 900.

  • Argentina SBO
  • Feb -830H/-940H
  • Mch -860/-940
  • MJJ -980/-1080
  • Brazil SBO
  • Feb -750/-1000
  • Mch -870/-950
  • Apr -920/-1020
  • MJJ ?/-1100
  • Palm Market Close 
  • Bmd : Apr 3949 (-68)
  • H 3987 / L 3944
  • Vol : 62,037
  •  
  • Oln 
  • Feb 880 vs
  • Fm 880 vs 
  • Amj 860 vs 855
  • Jas 832.5 vs 827.5
  • Ond 822.5 vs 
  • Rbdpo: -5
  • Strn: Feb 880 (deld) 
  • Pfad: Jan 727.5 (deld)
  • Local Cpo: Feb 4000
  • Laurics 
  • Cpko: Feb 253 (pk) / 255 (pg)
  • Rbdpko: Feb 980
  • Rbdpkoln: Feb 925
  • Rbdpks : Feb 1100
  • Sbo : 
  • Mar 4650 (-43)
  • May 4708 (-41)
  • Jul 4726 (-42)
  • Dce :  
  • May 7412 (-112)
  • Sep 6988 (-104)
  • 6 ports FM   950 vs 920
  • AMJ 950 vs 920
  • JAS  960 vs 935
  • Black Sea sunflower oil FOB 830 vs —
  • Russian sunflower oil FOB 825 vs —
  • Spain indicated at USD 945 vs 900
  • Italy indicated at USD 940 vs —
  • CIF Lw India indicative prices USD 940 to price vs 910
  • Turkey Mersin indications USD 890 vs —
  • Currency INR 83.13, RM 4.73, Rub 90.16 and Euro 1.0845


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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