• Bloomberg quoted Oil World as saying that India's palm imports may rise from 9.2mil tonnes in 2016/2017F to 9.7mil tonnes in 2017F/2018F. In total, India's imports of vegetable oils are forecast to be 16.1mil tonnes in 2017F/2018F. Oil World also said that CPO prices may fall to RM2,600/tonne by October to December 2017.

• Bloomberg also reported that China plans to expand the use of ethanol gasoline for vehicles from only 11 provinces currently to nationwide by year 2020F. The National Energy Administration said that China's stockpiles of grains and annual output of more than 400mil tonnes of straw and forestry waste can be used as feedstock to produce ethanol. Biofuels accounted for only 1% of the country's oil consumption in 2016.

• According to Bloomberg, the European Union's (EU) reduction in the anti-dumping duties on Argentina's biodiesel products has set a precedent for Indonesia. Currently, the EU is still deliberating on antidumping measures on biodiesel imports from Indonesia. Recently, the EU cut anti-dumping duties on Argentina's biodiesel products from a high of Eur245.67/tonne to a maximum of €79.56/tonne to comply with a WTO verdict. The WTO ruled against the method the EU used to calculate the cost of biodiesel production in Argentina. Companies benefiting from the cut in the EU's anti-dumping tariffs are the Argentine operations of Bunge, Cargill, Louis Dreyfus and Molinos Rio de la Plata.

• Reuters reported that Bunge Ltd has issued US$1bil worth of debt to replace a credit line financing a US$946mil investment in Loders Croklaan. Bunge has issued US$400mil five-year notes at 3% and US$600mil 10-year notes at 3.75%. Bunge's diversification focus is on higher-margin food ingredients that complement its core grain handling, processing and shipping businesses. Bunge's CEO said that the acquisition of Loders Croklaan will help the group's food and ingredients segment contribute to a third of earnings in the long term.

• Platts quoted as sources as saying that the US could have trouble meeting its biodiesel mandate as imports from Argentina and Indonesia have been cut off by duties. Recall that the US has proposed duties of 50.3% to 62.2% on biodiesel from Argentina and 41.1% to 68.3% on biodiesel from Indonesia. While the National Biodiesel Board is in favour of the anti-dumping duties, some industry players are concerned. Domestic players would still face expensive logistics and feedstock that would keep them uncompetitive even without overseas competition.

• A former UN Climate chief has called on the European Union to step up regulatory action against deforestation by tackling emissions of imported agricultural products such as soybean and palm oil. In an article on euractiv.com, the official said that the low-hanging fruit is to build on private sector initiatives such as the "The Consumer Goods Forum", which aims for zero net deforestation by year 2020F. A key part of the plan is to forge a political strategic alliance with a few developing countries such as Indonesia, Brazil and Malaysia to focus on soybean and palm production.

• SGS and Intertek said that Malaysia's palm oil shipments rose by 26.8% and 25.4% respectively in the first 20 days of September compared with the same period in August. According to SGS, Malaysia's palm exports to China climbed by 67.2%, which helped offset a 32.7% drop in shipments to India. Intertek said that RBD palm olein accounted for 43.3% of the country's palm exports in the first 20 days of September while crude palm oil made up another 17.3%.

Source: AmInvest Research - 25 Sept 2017