18 February 2013 09:50 [Source: ICIS news]
SINGAPORE (ICIS)--Palm oil freight rates from Malaysia to India and China are likely to be stable-to-firm in the next two weeks as demand typically picks up after the Lunar New Year holiday, market players said on Monday.
Palm oil freight rates from southeast Asia to India for a 10,000-tonne vessel were assessed at $42-46/tonne for the week ended 18 February, according to ICIS.
“[The palm oil] market gets very active after [the] Chinese New Year,” said shipbroker, adding that few ships were available prior to the 9-15 February holiday in China.
In March, however, freight rates will be under pressure as a 4.5% tax on Malaysian palm oil exports will take effect, as crude palm oil (CPO) prices crossed the Malaysian ringgit (M$) 2,250/tonne ($738/tonne) threshold, market players said. A zero export tax was in effect in January and February.
CPO futures for March delivery traded on Bursa Malaysia settled at M$2,542/tonne on Monday.
“[Freight rates] may soften [in March, but] it will depend on the supply and demand of vessels,” said another shipbroker.
Malaysia is the second largest palm oil producer in the world after Indonesia, while India and China are the world's two largest importers of palm oil.
($1 = M$3.09)
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