1.  Palm oil prices on the Bursa Malaysia exchange should continue to be supported in the first quarter of 2017, with price levels hovering around MR 3,000/ mt or $672.75/ mt, Kelvin Chow, food and agriculture expert at Rabobank Singapore said on Tuesday.
2.  Cost support would originate from the annual seasonal manufacturing downturn along with the pick-up in January Malaysian and also Indonesian palm exports, he said.
3.  https://www.irooildrilling.com forecast from Indonesia and also the southerly peninsula of Malaysia revealed that the region would certainly be quite dry, with lower-than-usual rains in January, Chow claimed.
4.  Palm oil costs would certainly continue to be supported throughout Q1 due to the drier-than-usual climate, complying with the serious El Nino in 2016.
5.  Nonetheless, any rise in rains would certainly reverse this pattern, he added.
6.  The rise in hand exports in January is generally because of freights to the Indian market, which had actually been starved of cash due to the current demonetization exercise. But, about 50%-60% of the liquidity was going back to the Indian market, restoring hand oil demand.
7.  At the same time, Chinese demand for palm oil still positions a big question mark, he claimed.
8.  The current rise in Chinese anti-dumping tasks on US dried distiller grains or DDGs-- which are an inexpensive pet feed component-- to 53.7% from 33.8% together with an increase in countervailing duties to 12% from 10.7% has actually effectively closed US DDGs out of the Chinese market.
9.  Chinese feed millers are presently utilizing soybean meal, rather than DDGs in their feed formula, Chow said, which would result in higher need for soybeans.
10.  When soybeans are squashed to produce soybean meal, soybean oil is also removed during the procedure.
11.  Greater soybean crushing to fulfill dish demand within China would cause higher soybean oil stocks in the nation and also minimize need for hand oil there, Chow added. This trend of lower palm oil need from China had actually been fairly noticeable throughout the last two quarters of 2016, he added, because the Chinese federal government had actually likewise been releasing its strategic soybean oil stocks in 2016.
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