Athena Tradewinds

1530 14032024 Athena Market Buzz Thursday 


ATHENA MARKET BUZZ 


MDEX reached its annual peak today, with May reaching a high of RM 4316 post-lunch. Despite a slow start, we settled at RM 4284 +89 by lunchtime, later gaining momentum from robust Indian demand, currently trading at RM 4286+91. While charts signal a strong buy for palm, with RSI trading over 77%, our research maintains a view of making shorts between RM 4250 - 4450. For May, we strongly advise traders to consider shorts within this range, with an exit strategy if the market shows higher lows and highs over the next two days, setting a stop loss at RM 4500.

Palm CNF India traded several times at USD 1010 for ROL, while CPO was indicated at USD 1040, with reports of small volumes trading even at 1035. The Indian market offers consecutive margins, prompting traders to liquidate existing stock without immediate replacement. Expectations suggest a potential correction tomorrow, as CBOT bean oil rallies but fails to breach the 50 mark. Additionally, a surprise fall in USA inventories led to a 3% jump in crude oil prices, increasing the possibility of palm being used more in biofuels. Locally in India, ROL prices trade between INR 94,500-95,500/-, with expectations of a slight rally.

CBOT bean oil rallied last night, settling May +75 at 48.57 and July +81 at 49.10, currently trading about 0.7% higher. The recovery from lows is evident, trading over 47.50 and potentially extending to 50.00, with expected resistance around 50 before aiming for the 52.50 mark. The current rally is mainly driven by commercials, as seen in the basis correction from -550 to -750, stabilizing around the -1000 mark with CBOT bean oil at 52.50, translating to flat price Idea of 936-940 and CNF India prices over USD 1000. Indian buyers are already paying over USD 1000 for palm oil, signaling a potential shift towards bean oil as well. Sunflower oil sellers' lack of aggression should benefit the bean oil complex, expecting the Indian market to rally towards USD 1070-1100 before a healthy correction.

Anyone without positions should consider making longs in bean oil, scaling up if the market corrects from the current offer of USD 990 to USD 900. MJJ prices below 900 present excellent long opportunities, with plans to liquidate once reaching over USD 1000 in India. While Brazil's crop is pegged by USDA at about 154, traders anticipate not over 146, which may offer further support to prices.

Ukraine and Russian sunflower oil sellers show little interest in marketing their produce currently, with crush and exports remaining healthy. Ukraine is expected to crush about 1.2 million MT of sun seeds until July, potentially leading to a stock squeeze and a premium for sunflower oil over soybean oil. Although sunflower oil remains the cheapest option, prices over USD 950 for destinations like India/Europe are high, prompting long cargo holders to consider exiting and pricing replacements later. The ongoing war continues to create uncertainty, emphasizing the importance of keeping inventories full. Blind buying is not recommended in a rally, and at current levels, waiting to price forward months is advised.

  • ARG SBO
  • Apr -750/-800, tdd -750
  • May -770/-890
  • MJJ -790/-920
  • BR SBO
  • Apr -/-750
  • May -600/-
  • JJ -630/-
  • AS -/-800
  • 6 ports Europe AMJ  $965 vs $945 
  • JAS   $985 vs $965
  • OND $965 vs $945
  • Palm oil Market Close 
  • Bmd : May 4291 (+96)
  • H 4316 / L 4190
  • Vol :  117,016
  •  
  • Oln 
  • Apr 987.5 vs
  • Mj 965 vs 
  • Jas 900 vs 892.5 
  • Ond 877.5 vs 870
  • Jfm 877.5 vs 870
  • Rbdpo: -5
  • Strn: Apr 970 (deld) 
  • Pfad: Apr 812.5 (deld)
  • Local Cpo: Mar 4350 
  • Laurics 
  • Cpko: Mar/Apr 301 (pk) / 301 (pg)
  • Rbdpko: Mar/Apr 1165
  • Rbdpkoln: Mar/Apr 1105
  • Rbdpks : Mar/Apr 1265
  • Sbo : 
  • Mar 4801 (+2)
  • May 4893 (+36)
  • Jul 4945 (+35)
  • Dce :  
  • May 8132 (+278)
  • Sep 7530 (+148)
  • Black Sea sunflower oil FOB indications 870 vs 840
  • Russian sunflower oil FOB USD 860 vs —
  • Spain indicated for April at USD 980 vs 950
  • Italy indicates for April at USD 975 vs 940
  • CIF India lw Ukraine indications only no firm offers  April  980 vs 970 , May 980 vs 950 and June 975 vs 945
  • Turkey Mersin indicated USD 900 vs 
  • Currency INR 82.78, RM 4.68, Rub 91.43 and Euro 1.0941
  • 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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