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Analysts at the Indonesian Palm Oil Conference said Indonesia's B30 biofuel mandate, effective January 2020, will raise domestic palm oil consumption. They forecast Rotterdam palm oil prices of $650 to $700 per ton for January to June 2020, up from a decade low of $507 last year.
Thomas Mielke warned that any small drop in export supply would tighten the world market.
Mandated domestic biodiesel use removes palm oil from export markets, which can lift global vegetable oil prices. Palm oil is hard to replace, so supply shortfalls have outsized price effects.
jakartaglobe.idNur YasminNov 3, 2019After 548 past bullish policy events, PALMOIL moved a median +0.4% over 5 sessions (61% higher; middle half -0.7% to +2.1%), and +0.9% over 20.
After 842 past bullish policy events, SBO moved a median +0.2% over 5 sessions (52% higher; middle half -1.6% to +2.1%), and -0.5% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Indonesia's B30 mandate from January 2020 raises domestic consumption and cuts export supply, with analysts forecasting higher prices.
The B30 mandate effective January 2020 raises Indonesian domestic consumption and cuts export availability, with analysts forecasting higher prices.
