08 November 2007 04:21 [Source: ICIS news]
By Anu Agarwal
SINGAPORE (ICIS news)--Crude palm oil (CPO) is hitting new highs and may hold onto gains despite increased output due to high crude values and strong demand from the food sector, regional palm oil traders and biodiesel producers said on Thursday.
CPO futures for January delivery on ?xml:namespace>
No let-up is expected in the short term despite increased palm oil production in
Strong demand from the food sector, especially from
Soybean oil prices have also been rising and CPO values traditionally track that product, said another regional trader.
Soybean oil prices in the US are at a 33-year high of more than 40 cts/pound and palm oil will remain high as long as this situation continues, he said. Soybean oil December futures on the Chicago Board of Trade closed at 43.64 cts/pound on Wednesday.
High vegetable oil prices - while beneficial for the growers - are spelling a doom for the biodiesel industry across the globe.
Biodiesel producers face not only high feedstock costs but also higher operating and shipping costs due to high crude oil. Biodiesel prices and demand, on the other hand, have not kept pace with these increases.
Workable prices of palm-based biodiesel from
Most of the biodiesel plants across
Asian countries have limited mandates or concrete plans for using biodiesel. Except for small mandates in places like the
Ironically, the major biodiesel producing countries such as
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