- Bloomberg quoted the CEO of Indonesia Estate Crop Fund Palmoil as saying that six producers will supply 339,000 kiloliters (119,717 tonnes) of biodiesel until October 2015. Suppliers include Wilmar International, Musim Mas, Darmex and Eterindo. Pertamina and AKR Corporindo are also in talks with suppliers for 426,000 kiloliters (150,440 tonnes) of biodiesel from November to December 2015. Non-subsidised biodiesel usage is estimated at 750,000 kiloliters (264,860 tonnes) until year-end.

- Incidentally, the Indonesian Palm Oil Association said that while the export levy may hurt CPO prices in Indonesia in the short term, they will help boost prices in the long term if the biodiesel mandate is enforced effectively. About 5.5mil tonnes of palm oil are expected to be used in the domestic market for biodiesel.

- Malaysia plans to expand B7 to the industrial sector. The proposal will be presented to the cabinet in three weeks’ time. The usage of B7 in the industrial sector is envisaged to take up 280,000 tonnes to 300,0000 tonnes of palm oil annually. Currently, usage of B7 in the automotive sector is absorbing about 500,000 tonnes of palm oil annually. The government is also mulling reinstating replanting incentives to smallholders, who have oil palm trees that are more than 25 years old.

- Solvent Extractors Association of India said that the government should increase the import duty on crude vegetable oils from 7.5% to 25%. Import duty on refined vegetable oils should be raised from 15% to 45%. Utilisation rate of palm refineries in India is about 30% currently.

- Bloomberg reported that soybean shipments from ports in Brazil including new terminals in Barcarena and Sao Luis are expected to increase from 11.5mil tonnes last year to 17.5mil tonnes this year. Due to new capacities at the ports, the increase in Brazil’s soybean exports from now until 2019 is not anticipated to be an issue. The savings from the new capacities have been absorbed by the trading companies. They have not been passed down in the form of lower freight costs to the farmers yet.

- Reuters reported that India plans to spend US$1.5bil in the coming three years to grow oil palm trees. Nine states with suitable climate have been identified. The government plans to grow oil palm trees on two million hectares of land with an estimated production of eight million tonnes annually in five years’ time.

- USDA reported that US soybean export sales in the week through 13 August were 784,405 tonnes, the most in two weeks. According to Bloomberg, an industry expert said that as soybean prices in the US fall, they would be able to compete better with cheaper South American exports to China.

Source: AmeSecurities Research - 24 Aug 2015