After a short rebound caused by vegetable oil speculation at the end of February, palm oil has fallen sharply recently. In addition to the pressure from its own fundamentals, the overall oil market atmosphere is also empty. Although vegetable oil rose sharply under the policy hype, it failed to effectively boost palm oil, and the expectation of soybean oil destocking failed to be fulfilled, making it a "he is my brother" with palm oil.
The impact of vegetable oil speculation is limited.
Compared with the sharp rise and fall of vegetable oil under the influence of policies, the soybean oil and palm oil markets operate more rationally, given that their imports have not encountered policy restrictions. Because the proportion of vegetable oil in the supply of oil and fat is not high, the pricing power of oil and fat still lies in soybean and palm oil, and vegetable oil has no leading role in the overall trend of oil and fat. At present, the overall demand for oil is sluggish, the import profit is good, and the short-term inventory is increasing. The rise of soybean oil and palm oil, the backbone of the market, is weak, and it is difficult for vegetable oil to effectively lead oil out of the overall downturn. The speculation of vegetable oil has evolved into a carnival alone.
According to our research, the recognition of edible palm oil is low in areas other than South China. Even if the price difference between vegetable oil and palm oil reaches a high level of more than 2,500 yuan/ton, palm oil will not replace vegetable oil too much, and the main benefits will be soybean oil and other kinds of oils. In short, the impact of vegetable oil speculation on palm oil is limited and cannot be effectively boosted.
Soybean oil failed to meet the expectation of destocking
Recently, soybean oil sharply retreated from the premium raised years ago, and the expectation of destocking failed to be fulfilled, which further suppressed the arbitrage of empty oil and multi-meal. Although after the previous plunge, the trend of soybean oil was slightly stable last week, but the overall situation is still not optimistic. Previously, the core logic of making more soybean oil in the market was that African swine fever affected the stock of pigs, and then affected the demand for soybean meal, and finally affected soybean crushing and soybean oil output, but this logic may be falsified. First of all, the price of soybean meal has fallen to this point, and the feed formula has increased the proportion of soybean meal, and the substitution of miscellaneous meal has become a growth point; Secondly, with the rise of pig prices, farmers may take the risk of delaying slaughter and increasing the consumption of soybean meal in the later stage; Finally, before the inflection point of domestic protein consumption, the growth of meat and poultry breeding will promote the consumption of soybean meal in other breeding sectors.
On the whole, the decline of soybean meal demand may be less than expected. Previously, the main reason for the decline of soybean oil was that the expectation of destocking in March was not fulfilled, and it has not yet been traded to the expectation of further inventory decline. However, with the arrival of a large number of imported soybeans in Hong Kong from April to June, if the expectation of a sharp decline in soybean meal demand is falsified, oil plants will crush or make soybean oil stocks increase again, which will easily lead to further collapse of soybean oil, thus dragging down the overall oil performance.
Palm oil producing areas have high inventory pressure.
SPPOMA said that the output of horse palm increased by 0.77% from March 1 to 25, while MPOA said that the output of horse palm decreased by 0.76% from March 1 to 20. The two institutions have successively given phased output forecasts with a lower growth rate than that of the previous month, but many people ignored the problem that the output base in February was already high. The output of horse palm in February was 1.54 million tons. Considering that the number of working days in March was more than that in February, and the month-on-month increase was 5%, the output in March will still be as high as 1.62 million tons, setting a new record for the same period. However, at present, the seasonal increase of palm oil production in producing areas has not yet started. Although El Ni? o has occurred, its impact is weak and lagging behind, and the overall output pressure in producing areas is still very high. To make matters worse, some negative changes have taken place on the demand side: the prospect of rapeseed production in India has improved, and the supply of soybean oil in China is more abundant than expected, which may make the replacement demand of palm oil less than previously expected.
In the context of continuous high output, it is expected that the quotation of the place of origin will still be difficult to hold firm, and the import profit will be given at a later stage, and the inventory pressure of the place of origin will be transferred to China. Although the long-term pressure is great, there is still some support in stages. At present, POGO spread is still at a low level, PME production and blending profits are good, and there is room for speculation in the market outlook. In addition, as China and India enter the pre-holiday stocking period, palm oil consumption is expected to increase in stages, which will boost palm oil prices in April. However, the rebound will be limited if the inventory pressure in the producing area is not reduced.
Generally speaking, as China and India, two major demand countries, stock up before April, palm oil consumption is expected to increase in stages under the high price difference between soybean oil and palm oil, which will boost the price of palm oil in April. However, under the background of high output in the producing area, it is expected that the producing area will continue to give the import profit of the demanding country, and the inventory pressure will be transferred to China. It is suggested that the medium and long-term palm oil should still be mainly rebound and short-selling.