Athena Market Buzz

1530 26032024 Athena Market Buzz Tuesday  


ATHENA MARKET BUZZ 



Good Day,

Mdex commenced the day mostly unchanged, and by lunchtime, trading remained within a narrow range. June, the most active contract, settled for lunch at RM 4246 -1, which currently stands at RM 4233 -14 at the time of this report. Mdex is consolidating strongly at these levels, with no major sell-off observed, despite the elevated prices, warranting caution. Overall palm production is declining, as is demand at destinations. CNF India offers for CPO range between USD 1025-1030, with ROL indicated around USD 1000. Despite the absence of demand at these levels, stocks aren't accumulating significantly. Due to higher prices, most traders and refiners are adopting a hand-to-mouth approach, resulting in temporary spikes in local markets. Our research team anticipates strong resistance between the RM 4250-4450 mark, with the market expected to move sideways. To consider long positions, one must wait for prices to correct below RM 4000 towards RM 3750 before initiating longs. Short positions can also be considered at current levels, with a stop loss at RM 4500. Crude oil production cuts are likely to maintain fuel prices above 80, allowing palm to continue its use in biofuels, thereby limiting overall correction. Consequently, long-term supports are expected to remain above RM 3450. Flat price ROL to India is approximately USD 100 higher than realistic levels and even costlier compared to other soft oil options. We advise traders to refrain from making longs unless palm corrects by at least USD 100 or falls below soybean oil prices.

CBOT settled higher on Monday as traders covered short positions ahead of this week's USDA report. Bean oil settled July +136 points at 49.57 and Aug +135 points at 49.52, trading mostly unchanged at the time of this report. Basis remains relatively stable, keeping the flat price largely unchanged. Indicative offers for soybean oil CNF India were at USD 1000 for nearby months and May/June at USD 995. Although bean oil is more expensive than sunflower oil, it is reasonably priced compared to palm oils. India is not experiencing significant demand at current levels, and as previously mentioned, we anticipate considerable resistance in flat prices, although a rally towards USD 1100 is expected eventually. CBOT is also anticipated to trend upwards and trade towards 52.50 before any correction. With the FED satisfied with the current state of the US economy and rumors circulating about a deferred interest cut to June, more funds are likely to exit their shorts. Indians are preoccupied with closing their financial year, and unless offered an excellent bargain, are reluctant to increase their positions. Locally, solvent oil is priced at 91,000/- and hinterland soybeans are still trading around MSP at 46,000/-.

Despite being the cheapest soft oil available for countries like India, the Middle East, and China, demand for Black Sea sunflower oil isn't explosive. Some trickle demand is observed, with buyers pricing CNF India between USD 955- USD 965 for April and May, while demand for forward months is absent. Increased tensions between Ukraine and Russia are keeping crude oil prices firm, safeguarding the bottom. On the upper side, as previously mentioned, we do not foresee a rally beyond USD 1050 CNF India, and we advise Indians against shorting at current levels. Destinations should prepare for a possible supply disruption around July, by which time sunflower oil is expected to trade at par or at a premium to soybean oil. Europe is indicated around USD 960, with buyers staying close to 940. Turkey, not a major buyer presently, sees prices indicated around USD 870 for Mersin, with buyers around USD 860.

  • ARG SBO
  • Apr -680/-750, tdd -690
  • May -750/-850
  • MJJ -800/-910
  • AS ?/-880
  • OND ?/-800
  • BR SBO
  • Apr -/-700
  • May -600/-
  • JJ -/-930
  • JJ -/-880
  • AS -/-790
  • 6 ports Europe May $955 vs -
  • MJ   $955 vs -
  • AMJ $955 vs $935
  • JAS  $980 vs $955
  • OND $970 vs $945
  • Palm oil Market Close 
  • Bmd : Jun 4237 (-10)
  • H 4280/ L 4217
  • Vol : 47,272
  •  
  • Oln 
  • Apr 995 vs 
  • May 967.5 vs 
  • Jun 952.5 vs 
  • Jas 897.5 vs 892.5 
  • Ond 877.5 vs 870
  • Jfm 880 vs 870
  • Rbdpo: -5
  • Strn: Apr 970 (deld) 
  • Pfad: Apr 810 (deld)
  • Local Cpo: Apr 4400 
  • Laurics: Apr 330 (pk) / 330 (pg)
  • Rbdpko: Apr 1295
  • Rbdpkoln: Apr 1235
  • Rbdpks : Apr 1395
  • Sbo : 
  • May 4884 (-18)
  • Jul 4938 (-19)
  • Aug 4934 (-18)
  • Dce :  
  • May 8266 (-34)
  • Sep 7618 (-8)
  • Black Sea sunflower oil FOB indications 820 vs 800
  • Russian sunflower oil FOB USD 810 vs —
  • Spain indicated for April at USD 940 vs 910
  • Italy indicates for April at USD 935 vs 900
  • CIF India lw Ukraine indications only no firm offers  April  965 vs 940 , May 960 vs 930 and June 950 vs 935
  • Turkey Mersin indicated USD 870 vs 860 rumoured
  • Currency INR 83.25, RM 4.71, Rub 92.54 and Euro 1.085
  • 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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