The highest volatility for ICDX’s CPO reached 1.24%
  • In a week (15/01 – 19/01) the price of ICDX’s CPO down 1.35%.
  • The highest volatility for ICDX’s CPO reached 1.24%.

Market Review

Indonesian Ministry of Commerce conveyed a protest through an official letter sent to the European Union Trade Commissioners due to the discriminatory for palm-based biodiesel products. On January 17th, 2018, the European Parliament officially approved the abolition of Palm Oil as the basic material of biodiesel energy that was passed through a vote at the European Parliament Building, Strasbourg, France.

China’s appetite for Palm Oil heading into the Lunar New Year holiday may be lower than expected as China’s own edible oil inventories have also been rising after record soybean imports and strong purchases of rapeseed oil, which reduce buyers’ appetite for more.

Malaysian CPO export data for January 1st – January 15th 2018 decreased to 564.968 metric ton compared to December 1st – December 15th 2017 at 596.862 metric ton and Malaysian CPO production data for December 2017 increased to 1.834.167 metric ton compared to December 2016 at 1.473.717 metric ton.

Malaysian CPO export data for January 1st – January 15th 2018 decreased to 564.968 metric ton

Price Performance Indicators

Previous Week % Change
CPOTR IDR 8,415 -1.35%
FCPO MYR 2,445 -3.59%
SOYBEAN OIL USD 32.28 -1.97%
CRUDE OIL USD 63.37 -1.45%
USD/IDR IDR 13,331 -0.23%
MYR/USD MYR 3.9365 -0.86%

Market View

RED II Proposal threat Indonesian Crude Palm Oil Export

European Union Parliament had approved the Renewable Energy Directive (RED) II proposal. This approval will exclude palm oil-made bio-diesel utilization. The proposal were planned to be effective in 2021 and threat Indonesian crude palm oil export by reducing the palm oil demand in destination country. Furthermore, the decision is feared to put pressure on Indonesian crude palm oil price. Note that majority of palm oil exported to European Union is used in bio-diesel production.

Indonesia Government to Continue Rejuvenation of Individual Palm Oil Fields Program

The Program is expected to starts in February and Riau would be the first place to the program implementation. The government replanting program, according to Darmin Nasution, is targeted to 185 hectare in 20 provinces and expected to increase productivity around IDR 125 trillion in a year.

WEEKLY ECONOMIC DATA & EVENTS CALENDAR

Date Data/Events Actual Expectation Previous
22/Jan Malaysia – Palm Oil Export Data (1 - 20 Jan)
24/Jan USA – Crude Oil Stock Change -5.121M
24/Jan Argentina – Interest Rate Decision 28.00% 28.00%
25/Jan Malaysia – Palm Oil Export Data (1 - 25 Jan)
25/Jan Malaysia – Interest Rate Decision 3.00% 3.00%
25/Jan USA – Food Price Outlook -0.20%

Source: Riset Indonesia Commodity and Derivative Exchange Research (ICDX)




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