LMC’s Fry is mildly bullish on palm prices as inventories shrink

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KUALA LUMPUR/JAKARTA (March 5): Palm oil demand is strong and will eat into production, LMC International’s Chairman James Fry says in interview at conference in Kuala Lumpur.

* Combined palm output in top growers Indonesia and Malaysia will likely rise 2.5m-3m tons this year, vs 5m tons growth in 2018:
 
* Slowdown comes after two years of bumper crops and as some planters cut fertilizer use in Indonesia because of low prices

* El Nino unlikely to have significant impact on palm oil production

* Palm oil demand growth will be driven by biodiesel as Indonesia and Malaysia raise blending mandates

* In China, spread of African swine fever will cut feed demand and lower soybean crushing, which could benefit palm oil

* Slower China growth projection won’t affect physical consumption of edible oils

* Indonesia’s zero export levy won’t adversely affect biodiesel funding as country has accumulated sufficient money

* Indian govt may be slow to cut import duties on crude palm oil as it looks to help farmers and there are elections