28 November 2012 10:01 [Source: ICIS news]
SINGAPORE (ICIS)--Fewer palm oil vessels have been travelling from southeast Asia to India in the past few weeks as vessels have been travelling to China, according to at least two market players on Wednesday.
The palm oil vessels have been travelling to China as buyers are stocking up on the commodity ahead of expected quality control measures starting from January next year.
“Everyone is stocking up on palm oil in China. Ships are travelling to China and are no longer going to India,” said a southeast Asian charterer.
According to reports, the expected measures may ask for lower prices of stearic acid and peroxide in palm oil cargoes, but Chinese authorities have not confirmed this.
As a result of the lack of tonnage, palm oil freight rates for southeast Asian cargoes to India are expected to rise in the coming weeks.
“Freight rates for palm to India will increase significantly at least until Christmas,” said a separate southeast Asian charterer.
For the week ended 23 November, palm oil freight prices from southeast Asia to India were at $38.00-44.00/tonne (€29.30-33.90/tonne) for a 10,000 tonne vessel and $37.00-40.00/tonne for a 15,000 tonne ship.
India and China are the world's two largest importers of palm oil.
($1 = €0.77)
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