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Thailand's Energy Ministry plans to raise the crude palm oil content in biodiesel from 6.6% to 6.8% to absorb a surplus of about 26,000 tonnes. The measure is intended to curb slumping palm oil prices.
Refiners and oil traders have been asked to prepare for the change.
A higher biodiesel blend mandate adds domestic palm oil demand and can firm local prices. The effect is small relative to the total surplus, so the impact is limited.
bangkokpost.comBangkok Post Public Company LimitedOct 31, 2018After 548 past bullish policy events, Palm Oil moved a median +0.4% over 5 sessions (61% higher; middle half -0.7% to +2.1%), and +0.9% 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.
Thailand's surplus of palm oil and its biodiesel blend plan show oversupply and price slump concerns, which feed bearish sentiment, though the 26,000 tonne volume is too small to move the market.
