AthenaBuzz

1400 12032024 Athena Market Buzz Tuesday 


ATHENA MARKET BUZZ


Good morning,

We've reached the anticipated levels of RM 4200 for April, and May is closely trailing behind. Crossing RM 4250 signals a clear sell, and we'll maintain this stance until RM 4450, advocating for selling. Despite favorable news and lower inventories, palm oil has peaked, prompting long-time players from RM 3400 to liquidate and add to shorts. With ample supply from soft oils, no major disruptions in supplies, and crude oil remaining below the 85-mark, palm is likely to face resistance, losing its premium status.

Ramadan demand has waned, China's consumption remains steady, but Indian appetite is shifting towards soft oils or local produce. Post-March, the Indian government may raise import duties on palm, disadvantaging it against other oils. Palm is the only oil with an 11% surge in the past 6 months, while bean oil, notably, has declined by over 20%. With RSI exceeding 70% and MDEX clearly in the overbought zone, caution is warranted.

Indian palm imports have decreased, yet Malaysian inventories are depleting, fueling the current rally. Some shippers are diverting contracts from India, potentially easing availability for other destinations. The new normal for palm oil MDEX should hover around RM 3750; waiting on the sidelines for price corrections seems prudent. At current levels, unless one opts for short positions, it's advisable to stay away and await a cooling-off period before entering the market to fulfill requirements.

CPO was offered to India this morning at USD 1010-1015, while ROL trades between USD 980-985, already higher than sunflower oil offers. Buyers should consider only if essential; otherwise, refraining from purchasing palm and its derivatives is advisable.

Soybean futures corrected yesterday but still show higher lows, offering hopes for recovery. Beans, which hit lows of 1133 around 26th Feb, have rebounded to 1177, while bean oil settled slightly higher. Brazil anticipates higher crops, the USA plans to plant more beans for competitiveness, and India seeks self-sustainability, increasing crop numbers for soybeans, groundnuts, and rapeseed oil. Soft oils show no shortage, we are not expecting a strong rally over USD 1100 in bean oil CNF India but we could see some more uptick to the current offers before we correct back lower.

Ukraine sunflower oil is not competitively priced compared to Russian, with Indian demand favoring Russian origin. Today's offers to India for April were around USD 970-975 for both origins, with buyers willing to pay USD 960-965. Europe remains firm, with offers around USD 965, awaiting prices to dip back to USD 900-920 levels. Sunflower oil stands as India's cheapest option, with Kandla players showing preference. If palm corrects next week, sunflower oil prices could follow suit, potentially correcting back to USD 900 levels.

Now is the time to gradually sell long positions and await price corrections for reentry.

  • ARG SBO
  • Apr -560/-600
  • May -600/-690
  • MJJ -640/-730
  • AS ?/-690
  • OND ?/-620
  • BR SBO
  • Apr -400/-500
  • May -500/-650
  • JJ -550/-730
  • AS -/-680
  • 6 ports Europe indicative AMJ  $970 vs $940
  • JAS   $980 vs $945
  • OND $955 vs —
  • Palm oil Midday Market Close 
  • Bmd : May 4165 (+34)
  • H 4167 / L 4115
  • Vol :  38,849
  •  
  • Oln 
  • Mar 945 vs 
  • Apr 945 vs
  • Mj 920 vs  
  • Amj 930 vs 920 
  • Jas 870 vs 862.5
  • Ond 855 vs 845
  • Jfm 855 vs 
  • Rbdpo: -5
  • Strn: Apr 942.5 (deld) 
  • Pfad: Mar 792.5 (deld)
  • Local Cpo: Mar 4250 
  • Laurics 
  • Cpko: Mar 283 (pk) / 283 (pg)
  • Rbdpko: Mar 1090
  • Rbdpkoln: *Mar 1030*
  • Rbdpks : Mar 1200
  • Sbo : 
  • Mar 4605 (unch)
  • May 4662 (-2)
  • Jul 4714 (+2)
  • Dce :  
  • May 7820 (+52)
  • Sep 7350 (+96)
  • Black Sea sunflower oil FOB indications 840 vs 820
  • Russian sunflower oil FOB USD 840 vs —
  • Spain indicated for April at USD 960 vs 920
  • Italy indicates for April at USD 955 vs 920
  • CIF India lw Ukraine indications only no firm offers  April  955 vs 940 , May 950 vs 930 and June 955 vs
  • Turkey Mersin indicated USD 880 vs 845
  • Currency INR 82.74, RM 4.67, Rub 90.83 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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