I．National stocks

    Cofeed News: edible palm oil at China’s ports this week ended Sept. 21st settles at 474,800 tonnes, generally up 11,100 tonnes from 463,700 tonnes the prior week by 2.4%, up 15,300 tonnes vis-a-vis 459,500 tonnes the same week last month (week 34) by 3.3% and up 103,400 tonnes as compared to 371,400 tonnes year on year by 27.8%. Stocks of industrial palm oil now are pegged at 75,900 tonnes, a rise of 2,100 tonnes or 2.8% contrasting with 73,800 tonnes.

    Honestly, two reasons account for stockpile accumulation of edible palm oils. First, palm oil futures at home and abroad this week come down regardless of expanded spread between soybean oil and palm oil, to be specific, the spread till Friday expands to 1,003 yuan/tonne, 106 yuan/tonne higher than 897 yuan/tonne last week. Second, demand for palm oil goes slack when stockpiling for packing oils ahead of holidays draws to an end, only with scattered stockpiling underway in the run-up to Chinese National Day, and demand is also seen shrunken when it gets colder and colder. On this point, buyers’ cautious attitudes toward market trade throw traded volumes into a lighter level, specifically, about 5,500 tonnes of palm oil are traded this week versus 9,500 tonnes last week.

    Notably, palm oil exports present a spike in Malaysia after the export duty is reduced to zero in September. According to cargo surveyor ITS, China has already imported 128,600 tonnes of palm oil from Malaysia in the first 25th day of September, up 41,610 tonnes from 86,990 tonnes attained in week 34. Meanwhile, as some shipments scheduled in August are delayed to September, estimated imports for 24-degree palm oil are likely to be around 0.35-0.4 Mln tonnes in September, and approximately 0.35 Mln tonnes in October and November on average. Yet when it turns cold, languishing demand for palm oil will probably result in stockpile accumulation.

                                     Figure: China’s palm oil stocks in recent years

    According to Cofeed, estimated imports of palm oil are shown as follows: September: 0.47-0.53 Mln tonnes (0.35-0.40 Mln tonnes of 24-degree palm oil, 0.12-0.13 Mln tonnes of industrial palm oil); October: 0.47-0.48 Mln tonnes (0.34-0.35 Mln tonnes of 24-degree palm oil, 0.13 Mln tonnes of industrial palm oil); November: 0.47-0.49 Mln tonnes (0.35-0.37 Mln tonnes of 24-degree palm oil, 0.12-0.13 Mln tonnes of industrial palm oil), all basically unchanged from last estimates. Arrivals of palm oil may change with the market and shipping schedule, therefore information will be updated according to latest shipments and possible defaults.