Bloomberg reported that Malaysia’s Plantation Industries and Commodities Ministry will launch a project under the national Covid inoculation programme that will focus on achieving herd immunity among palm oil workers. The project will first be rolled out in Selangor for about 5,000 workers. The vaccines will be supplied by the government but companies must fund the costs of the vaccine dispensing centres, medical supplies, doctors, nurses and allowances for the volunteers.
Reuters reported that Chinese state-owned importers bought at least eight cargo shipments or 480,000 tonnes of US soybeans two weeks ago. This was the largest purchase of US soybeans in four and a half months. China had slowed its US soybean purchases in recent months as cheaper shipments of newly harvested Brazilian soybeans became available and as US soybean prices soared to the highest in about eight and a half years. China has largely focused on feed grain purchases from the US this spring, booking record volumes of US corn and sorghum as China’s domestic corn prices rose to historic highs.
Jakarta Globe cited the Indonesian Palm Oil Association (GAPKI) as saying that market restrictions in the EU continued to be the main hurdle for Indonesian palm oil exports in the past three years despite ongoing negotiations and efforts at the World Trade Organization. An official with GAPKI said that the country must not give in and it needs persistent and tough negotiators. Another official admitted that he does not expect an immediate settlement with the EU. He added that the EU has stated that it does not have a timetable for concluding negotiations and as such, “this may take forever”.
Reuters reported that US merchant refiners have amassed up to a US$1.6bil shortfall in the credits needed to comply with the US biofuel law, an apparent bet that the Biden administration will let them off the hook or that credit prices will fall. The big liability among the refiners comes as the Biden administration considers granting oil refiners, relief from their biofuel mandates amid soaring credit costs and economic turmoil from the coronavirus pandemic that has hurt the fuel industry. Under the US Renewable Fuel Standard programme, refiners must blend billions of gallons of biofuels like ethanol into their fuel or buy compliance credits.
In a related development, Bloomberg cited an oil refiners trade group as saying that the cost of complying with a federal mandate to blend biofuels into gasoline and diesel is skyrocketing and could reach US$30.5bil in 2021F. The American Fuel and Petrochemical Manufacturers based its analysis largely on recent record high prices for tradeable credits known as Renewable Identification numbers. On a per gallon basis, the RFS (Renewable Fuel Standard) compliance could add as much as 23 cents to the cost of wholesale fuel production.
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