$Crude Palm Oil Futures(APR5) (FCPOmain.MY)$ In Indonesia, t...

In Indonesia, the GAPKI data in August is not too much to say, lagging and fully traded, and the market is focused on and looking forward to the recovery of production in September/October, which is the two months with the highest production under the regular seasonal state, and the market has placed a lot of expectations on it. According to some Indonesian plantation information sources and field research in Indonesia, it is claimed that the output in September may reach 20% month-on-month, coupled with the recovery of production in October, Indonesia's inventory in October may recover to 4 million tons, which is already a relative limit. Even so, Indonesia will enter the current state of strong reality and strong expectations in Malaysia, which is based on seasonality and Indonesia's B40 policy is expected to be implemented in early 2025.

It is recommended to pay attention to Indonesia's local daily CPO tender price or local FFB (TBS) weekly purchase price, which has become a more sensitive indicator for monitoring Indonesia's production recovery.

Above, Malaysia and Indonesia will not have obvious pressure in the short term, before India and China  complete the replenishment action, should not see a sharp retracement of palm oil, palm oil strong period may run through Q4 and Q1 next year, palm oil to see the seasonal production inventory rebound, bulls can tell a lot of stories.

Indonesia CPO price

The negative side of the oil also appears in the reduction of rapeseed and sunflower production, northwest European rapeseed oil and European sunflower oil spot is not completely in the domestic sight.

This year's extreme weather in Europe and the downgrading of yields by local institutions from 3.17 tonnes/ha to 3.07 tonnes/ha have confirmed this year's cuts.

The reduction in sunflower production is mainly focused on Ukraine, and the problems encountered in 24/25 are low carry-over stocks in 23/24 and a significant reduction in production in 24/25, and the market expects a reduction of more than 4 million tons in the Black Sea region corresponding to a reduction in sunflower oil production of about 2 million tons.

Based on the above reality and expectations, vegetable oil in Northwest Europe has risen by about 22% (1019-1245) since the stage low on September 13, and the price increase of sunflower oil in Europe is more extreme because it involves a sharp decline in the inventory of old crops, which has increased by about 59% (813-1290) since the stage low on May 2 this year.

Future outlook, because China's rapeseed imports are basically through Canada, so the impact of European rapeseed production reduction on China is limited, but China currently has an anti-dumping investigation on Canadian rapeseed, domestic traders have washed ships in the early stage of the import volume is not enough, neutral estimates can see that rapeseed oil inventories can be seen in December, and a large number of rapeseed oil imports in September temporarily cover the follow-up nervous expectations.

In terms of sunflower oil, referring to Ukraine's export seasonality, it is expected that the domestic sunflower oil tension may appear in the second quarter, and India imported a large amount of sunflower oil from March to July in 23/24 The current sunflower oil inventory is significantly depleted, but India's sunflower oil demand in 24/25 may be transferred to palm oil or soybean oil, which may delay the time node for Southeast Asian inventories to loosen.