The Palm Oil Bull Market Is Not Dead

The bull market in the palm oil is NOT dead!

So said Godrej International Ltd director Dorab Mistry.

• “The market is oversold and I would say we’re in transition. I may be mistaken but I’m convinced the bull run is not yet over. We still have a couple of years more to go,” said Godrej International Ltd director Dorab Mistry.
  
  Changing weather patterns could also affect yields of soyabean in the US and grains in India.
  
  “The US Department of Agriculture had over-estimated August rainfall in the US and there is still a question mark on the soya-bean yield,” he said.
  
  If the production of soyabean falls, its prices could rise. This in turn, could also boost the palm oil price as both are a near perfect substitutes. Both are used to make cooking oil, margarine, detergent and cosmetics.
  
  “These development are giving support to palm oil prices,” he told a hall full of more than 500 participants at the International Palm Oil Trade Fair and Seminar 2008 held in Kuala Lumpur yesterday.
  
  In a separate session, the Palm Oil Refiners Association of Malaysia (Poram) told reporters that defaults of palm oil shipments to India and China are not massive. At most, it is only around 80,000 tonnes.
  
  The trade body said recent news reports of exaggerated defaults has cause unnecessary panic and further price plunge in the palm oil futures market.
  
  “Certainly, there are some defaults. I’ve checked with all our members and we find that it is not to the extent of 800,000 or one million tonnes ... that is impossible,” said Poram acting chairman Yong Chin Fatt.
  
  Defaults occur when buyers do not want to honour a contract when prices fall too much too fast and vice versa for sellers.
  
  In today’s context, Yong said Malaysia's palm oil trading with India or China is already quite established and developed.
  
  “We sometimes wonder whether the exaggeration is done intentionally (by people who have vested interests) to cause distress in the market and push down the price further,” he said
  
  
  

source of article: here

Do note that this is an as-it-is-article. If you agree or disagree with what the article is saying , especially the point where Poram acting chairman Yong Chin Fatt suggested that the defaults in palm oil shipments is exaggerated and that there were probably some shenanigans aimed at pushing the prices lower, please do leave your opinion and reasoning on why you think so.