• ABC News said that Zoos Victoria has removed Nestle products from its kiosks and food carts after the company was suspended from the RSPO. Nestle was suspended from the RSPO a few weeks ago as it did not submit a report on its progress on producing and buying certified sustainable products. Zoos Victoria said it would not sell Nestle products at Melbourne Zoo and Werribee Open Range Zoo unless Nestle complies with RSPO standards. Zoos Victoria only sells products that are free of palm oil or contain 100% certified sustainable palm oil.

• Bloomberg reported that China’s rapeseed oil auctions will resume this week. A total of 61,000 tonnes of rapeseed oil will be offered from the state reserves on 17 July. The government will also offer 493,000 tonnes of soybeans each from its reserves on 11 July and 18 July. Additionally, the government will offer 49,000 tonnes of soybean oil from its reserves on 11 July and 56,000 tonnes of soybean oil on 18 July. We believe that China is shoring up the domestic supply of soybean after the tariff of 25% on US soybeans took place on 6 July. We think that there could be more than a million tonnes of soybeans in China’s state reserves as the country has offered to sell about 1.6mil tonnes of soybeans in four auctions from 14 June to 4 July.

• According to Bloomberg also, China will reimburse the buyer for the cost of the 25% tariff on soybean imports from the US if the cargoes are for state reserves. State reserve buyers will pay the additional tariff before they are reimbursed later by the government. Sinograin is the group that handles the state stockpiles.

• Ecobusiness reported that Golden Agri-Resources is testing new GPS-based technology to establish traceability for the palm oil it sources from third-party mills in Indonesia. A company official said that sometimes, third-party mills do not know where the fruits come from. To establish a tracking and verification system for the third-party mills, Golden Agri is working with a network of partners with the goal of achieving full traceability by the end of year 2020.

• Reuters cited China’s commerce ministry as saying that it will use the funds collected from the tariffs imposed on US imports to help ease the impact of US trade actions on Chinese companies. The commerce ministry has also encouraged companies to increase imports of products such as soybean and motor vehicles, from other countries.

• SGS said that Malaysia’s palm shipments fell by 23.1% in the first 10 days of July compared with the same period in June. This was mainly due to a 42.8% plunge in palm exports to China. China’s weaker demand could not be offset by an 89.1% increase in palm shipments to India.

Source: AmInvest Research - 16 Jul 2018