Thomas Mielke 2019

Thomas Mielke, for more info www.oilworld.
de IPOC 2019 - Palm Oil Price Outlook on 1 Nov 2019
Global Supply, Demand and Price Outlook

of Palm Oil and Other Veg Oils
Indonesian Palm Oil Conference IPOC 2019 in Bali on Oct 31 – Nov 1
Thomas Mielke, ISTA Mielke GmbH, Oil World,

Global Market Research on Oilseeds, Oils and Meals
Feel free to contact me for assistance at <thomas.mielke@oilworld.de>
Oct 31, 2019

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Source: ISTA Mielke GmbH, Oil World 1

Thomas Mielke, for more info www.oilworld.de IPOC 2019 - Palm Oil Price Outlook on 1 Nov 2019
At the end of 2018 and in mid- Weekly Prices of Palm Oil, fob Indonesia (US-$/T)
2019 palm oil prices were 800
below production costs for 760
many smallholders. 720
Prices are recovering. 680
640
Global consumption has started
to exceed production. Deficit 600
set to widen in 2019/20. 560
520
World palm oil stocks peaked at
15.3 Mn T in Jan 2019, 480
dropped to 14.7 Mn in Sep 19 440
and may fall by 2-3 Mn T in next 400
12 months Jan 17 Jun 17 Jan 18 Jun 18 Jan 19 Jun 19
Prices from 1 Jan 2017 until 30 Oct 2019
Oct 31, 2019

Weekly Prices of Palm Oil, fob Indonesia (US-$/T)

Indonesian fob export prices 800
appreciated to US $ 564 for
nearest forward shipment on 760 2017
30 Oct 2019, a 15-month high 720
680
Probably a bit premature
640
But in the next 7-10 months 600
2018
there is a further upward 560
potential in palm oil prices by 520 2019
US $ 80-100, probably more
480
440
400
Jan Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec
Oct 31, 2019


RBD Palm Olein, fob Malaysia, Oct 25 Soya Oil, fob Argentina, Oct 25
nearby and deferred in US -$/T nearby and deferred in US-$/T
690 690
670 670
650 650
630 630
610 610
590 590
570 570
550 550
530 530
510 510
490 490
Nov Dec Jan/Mar Apr/Jun Jul/Sept Nov Dec Jan/Feb Mar/Apr May/July
Oct 31, 2019

Indonesia holds a major key for the future

INDONESIA: Booming Dom. Palm Oil Usage
price trend - - in respect to both 18
production and consumption ! for biodiesel production
15 other uses (primarily food)
Production smaller than expected in
second half of this year. Next year below-
12
average growth.
Indonesian domestic palm oil consumption 9
more than doubled from 7 Mn T in 2015
and is likely to reach 15 Mn T in 2019 6
In 2020 with full implementation of B-30, 3

Indonesian biodiesel production would
increase to 9.3-9.5 Mn T, including exports. 0
2005 2007 2009 2011 2013 2016 2018 2020F
-> Domestic palm oil use would be close to
17 Mn T in Jan/Dec 2020.
Oct 31, 2019


PALM OIL Outlook:

PALM OIL : World Production
In the 3 years to 2018/19
Annual Change (Mn T) world production
8 skyrocketed by 18 Mn T !
7
6
5 World output to rise by 4.6
4 Mn T in Oct/Sept 2018/19.
3
2 (76.7 Mn). Indonesia +2.7
1 and Malaysia +1.1
0
-1 A slowdown of the growth
-2
-3 to 1.5 Mn T is anticipated
-4 for Oct/Sept 2019/20.
-5 Indon +1.8 and Malay -0.5
05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F
October / September
Oct 31, 2019

World PALM OIL Outlook

PALM OIL: World Consumption & Supplies (a)
World output rose by 4.6
A nnual Change (M n T)
Mn T in Oct/Sept
8 2018/19. (76.7 Mn T)
7
6 Consumption increased
5 by 7.7 Mn T in 2018/19.
4
3
? (76.6 Mn T)
2
1 Global supply & demand
0 balance expected to
-1 Production tighten in 2019/20, as
-2 production will probably
-3 Supplies (a) (a ) O pen in g s toc ks +
pr od uction be only 78.2 Mn T (+1.5)
-4 C onsum ptio n
-5 and usage at 80-81 Mn T
09/10 11/12 13/14 15/16 17/18 19/20F Palm oil stocks may fall
O ctob er/S e pte m b er by 2-3 Mn T till Sept 2020
Oct 31, 2019


The Dominance of Palm Oil and of Soya oil

17 OILS & FATS : World Production (Mn T) 17 OILS & FATS : World Exports (Mn T)
80 60
Soy, Rape, Sun Oils
55
70 4 Animal Fats
Palm oil 50 Palm Oil
60 45 9 Other
40
50
Soya oil 35
40 30
25
30
4 Animal Fats 20
20 Rape oil
15
9 Other oils
Sun oil 10
10
5
0 0
98/99 01/02 04/05 07/08 10/11 13/14 16/17 19/20F 04/05 07/08 10/11 13/14 16/17 19/20F
Oct 31, 2019

The 40-Year Success Palm Oil Production 1980 - 2019

Story of Palm Oil. in Major Countries (Mn T)
80
Will it continue? Malaysia
70
Indonesia
Many Challenges Effects of El Nino
60 Rest of W orld
50
40
30
20
10
0
1982 1986 1990 1994 1998 2002 2006 2010 2014 2018
1980 1984 1988 1992 1996 2000 2004 2008 2012 2016
Oct 31, 2019

Palm Oil Losing Competitiveness Yield increases in the past 15 years:

Soybeans +26%
MALAYSIA: Annual Palm Oil Yields (T/ha) Rapeseed +6% (+42% without EU)
4,6 Sunflowerseed +62%
4,4 SOYB EA N, RAPESEED & SUNFLOW ER SEED
T/ha Yiel ds in key countr ies in T / ha
4,2
3,4
3,2 Soyb eans
4
3
3,8 2,8
2,6
3,6 2,4
2,2
Rapeseed
3,4 2
1,8
3,2 1,6
1,4 Sunflowerseed
3 1,2
90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 1
0 4/0 5 0 6/0 7 0 8/0 9 1 0/11 12 /13 14 /15 1 6/1 7 1 8/19
Oct 31, 2019

PALM OIL Outlook: PALM OIL : Production in Key Countries (Mn T)

Reduced fertilizer usage.
50
Dryness. Malaysia Indonesia
Slow down in new plantings. 45
Lack of replanting + labour 40
Slow down of the production 35
growth in Indonesia to 1.8
30
Mn T in 2020 (45.4 Mn T)
from 25
+2.0 Mn T in 2019 (43.6) and 20
+4.2 Mn in 2018 (41.6)
15
Malaysian production set to
drop slightly in 2020 from
10
20.5 Mn T in 2019 (+1.0 Mn) 5
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020F
Rest of world: output to grow 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019
+0.3 Mn T in 2020 (vs. +0.6) January / December
Oct 31, 2019


Outlook 2019/20:
SOYBEANS
World Production of
World Production (Mn T) and Area (Mn ha)
Soybeans: -19 Mn T 400
Open‘g stocks +14 Mn T 360
End Stocks -11 Mn T 320
Production
280
Our current soya crop
240
estimates 2019/20:
200
USA 97* (vs 120.5) 160
Brazil 123* (vs 118) 120
Argentina 53* (vs 54) Harvested Area
80
40
World 339* (358 Mn)
01/02 05/06 09/10 13/14 17/18
99/00 03/04 07/08 11/12 15/16 19/20F
Oct 31, 2019

Record soybean stocks in S o yb e a n s : W o r ld S to ck s a s o f e n d -A u g u st (M n T )

2018/19. 120
110
World supplies of soybeans 100
less ample as expected, 90
following recent revisions of 80
the soybean crops in the
70
USA, Inida America.
60
Of course, uncertainties 50
remain in 40
- China buying and usage 30
-S. America: weather + yields 20
10
0
2 00 0 2 00 2 2 00 4 2 00 6 2 00 8 2 01 0 2 01 2 2 01 4 2 01 6 2 01 8 2 02 0F
Oct 31, 2019


Impacts of the Trade War China - USA

CHINA: Oilseed Output & Crushings
140
Oilseed crush in 130 Production (Mn T)
China down sharply 120 Crushings (Mn T)
by 12 Mn T in 110
100
Oct/Sept 2018/19 90
Another decline in 80
70
2019/20
60
This year’s soybean 50
crop about 15.6 Mn T 40
30
20
01/02 04/05 07/08 10/11 13/14 16/17 19/20F
Oct 31, 2019

Impacts of the Trade War China - USA

Soybeans : Crushings in Key Countries (Mn T)
100 World soybean crushings are
90
U.S.A. China declining in 2018/19, despite
EU -28 Brazil
80 Argentina
ample world supplies.
70
60 Global impacts on veg oils:
50 - soya oil balance is tightening
40 - boost in palm oil demand
30
20 In 2019/20 world soya crush
10 likely to recover, raising
0 soya oil supplies and exports
01/02 05/06 09/10 13/14 17/18
99/00 03/04 07/08 11/12 15/16 19/20F
October/Septem ber
Oct 31, 2019


Trade War Impacts on Oils & Fats
China is increasing CHINA, P .R.: Imports of 17 Oils & Fats (1000 T)

imports of palm oil, October / September
soya oil, sun oil and 18/19 17/18 16/17 15/16 14/15
Soybean oil . . . . 783 481 711 586 773
other oils to Groundnut oil. . . 172 112 111 113 141
compensate smaller Sunflower oil . . . 1032 785 725 878 534
domestic production Rapeseed oil . . . 1507 1067 802 768 732
Palm oil . . . . . . . 6885 5422 5016 4798 5822
resulting from reduced Palmkern oil. . . . 890 701 595 560 578
soybean crushings Coconut oil . . . . 177 140 134 136 136
Other oils & fats. 612 644 591 528 543
Total . . . . . . . . . 12058 9352 8685 8367 9259
Oct 31, 2019

CHINA, P.R.: 17 Oils & Fats

42
Consumption
38
34
30
26
Production
22
18
14
10
Imports
6
13/14 14/15 15/16 16/17 17/18 18/19 19/20F
Oct 31, 2019

World production on a RAPESEED & C ANOLA

declining trend and down
again in 2019/20, falling to World Production (Mn T) and Area (Mn ha)
70
an 8-year low of 62 Mn T.
65
Production
In some countries farmers 60
losing interest in rapeseed 55
cultivation. 50
45
Biggest crop losses in the 40
past few years where in: 35
the EU, China & Australia 30
Harvested Area
25
EU rape oil consumption 20
seen declining 0.5-0.6 Mn T 15
00/01 02/03 04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19
99/00 01/02 03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F
Oct 31, 2019

SUNFLOWERSEED
Phenomenal growth in World Production (Mn T) and Area (Mn ha)
sunflowerseed cultivation and 55
production in recent years. 50
Production
Production in 2019 and in 2015: 45
Russia: 14.2 Mn T (vs. 9.7 Mn) 40
35
Ukraine: 15.6 Mn T (vs. 12.1 Mn)
30
World production of sun oil in 25
2019/20 is forecast to increase Harvested Area
20
further by 0.9 Mn T above the
2018/19 record of 20.0 Mn T 15
01/02 05/06 09/10 13/14 17/18
99/00 03/04 07/08 11/12 15/16 19/20F
Oct 31, 2019


Substantial Growth in World Demand of Oils/Fats

17 Oils & Fats : World Consumption
Average demand growth in past 5
seasons: Total Usage in Mn T
240
Total +7.2 Mn T 220
per year 200
180
Biofuel +2.4 Mn T 160
Food/other +4.8 Mn T 140
120
In 2018/19 world consumption of 100
17 oils/fats reached 235 Mn T. 80
About 17% of that was used for 60 biofuel food and other
energy 40
20
0
90/91 92/93 94/95 96/97 98/99 00/01 02/03 04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19
89/90 91/92 93/94 95/96 97/98 99/00 01/02 03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F
Oct 31, 2019

Biodiesel and HVO

World Production of Biodiesel (Mn T)
Biodiesel production almost trebled in 50
the past 11 years. And will rise sharply
again to 45-46 Mn T in 2019.
But the growth is set to slow from 2021 40
onward.
30
15.3 Mn T of palm oil for biofuels in
2018 or 21% of world PO consumption
(14.3 for biodiesel and 1 Mn for electricity) 20
Driven by Indonesia, about 18.5 Mn T of

10
palm oil (24%) will be used worldwide
for energy in Jan/Dec 2019
0
2007 2009 2011 2013 2015 2017 2019F
2006 2008 2010 2012 2014 2016 2018
Oct 31, 2019


Importance of palm oil in global oils & fats market

PALM OIL: World Consumption (Mn T) In Jan/Dec 2019 world
80
75 consumption of palm oil seen
70
65 at 77.5 Mn T (+6.7 Mn T from
60 last year and +16.5 from 2015)
55
50
45
40 Consumption of 17 oils & fats
35
30 set to rise by 7.5 Mn T
25 - Soya oil stagnating
20
15 - Rape oil down
10
5 - Sun oil up
0 - all other oils slightly down
19 70 19 76 19 82 19 88 19 94 20 00 20 06 20 10 20 14 20 18
From Jan/D ec 197 0 un til 201 9
Oct 31, 2019

PALM OIL : Imports of Major Countries (1000 T)

Rapidly increasing imports 10
EU-28
of palm oil in 2018/19, 9 Bangladesh
8 China, PR
rising by about 4.4 Mn T or India
7 Pakistan
almost 10% globally
6
In 2019/20 imports reaching 5
new records in India and 4
China 3
2
1
0
04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19
03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F
Oct 31, 2019


17 OILS & FATS: Exports of Major Countries (Mn T)

PALM OIL: Share of Total Consumption 35
Indonesia
of 17 Oils & Fats in 2019/20 in % Malays ia
70
30
Argentina
59% 62% U.S.A.
58% 25
60 Cana da
Ukraine
50 20 Russia
40%
40
15
30
22% 10
18%
20
5
10
0
0
EU-28 India Pakistan China Oth. Asia Africa 98/99 01/02 04/05 07/08 10/11 13/14 16/17 19/20F
Oct 31, 2019

Summary and Conclusions

Global Production growth will
slow down in 2019/20 8 Veg. OILS: Production & Demand
Change From Year Ago in Mn T
Output of 8 veg oils forecast to
rise by 3.2 Mn T in 2019/20 14
compared with a rise of 5.4 Mn 12
last season 10
8
Palm oil +1.5 Mn T (vs. +4.6 Mn) 6
4
Oth 7 oils +1.7 Mn (vs. +0.8 Mn) 2
0
Soya oil +0.9 Mn T (vs. -0.2 Mn) -2
Production Consumption
Sun oil +0.9 Mn T (vs. +1.0 Mn) -4
Rape oil -0.5 Mn T (vs. -0.3 Mn) 11/12 13/14 15/16 17/18 19/20F
10/11 12/13 14/15 16/17 18/19
Laurics +0.1 Mn T (vs. +0.7 Mn) O ct ob er / S ept em ber
Oct 31, 2019


17 OILS & FATS: Surplus/Deficit of Output vs. Usage 17 OILS & FATS
6 Annual Stocks / Usage Ratios (%)
Mn T
5 Surplus 24
4 Palm Oil
3 22 Sun Oil
2 Soya Oil
20
17 Oils/Fats
1
18
0
-1 16
-2
14
-3
Deficit
-4 12
-5 10
-6
-7 8
05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F 03/04 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F
Oct 31, 2019

Veg oils are getting firmer relative to World Stocks in Percent of Annual Usage (%)
meals. The oil share is going to rise 24
within the next 12 months 22
20
FACTOR TO WATCH:
18
- Economic activity (slowing down),
financial markets, currencies? 16
14
- US-China? Canada-China?
12
- Weather and production 10
17 oils & fats
10 oilseeds
- timing of the demand rationing and 8
buying strategies of consumers 05/06 07/08 09/10 11/12 13/14 15/16 17/18 19/20F
04/05 06/07 08/09 10/11 12/13 14/15 16/17 18/19
- biodiesel policies (Indonesia, USA) At the end of the season
Oct 31, 2019


Weekly Prices of Palm Oil, fob Indonesia (US-$/T)

● Forecasts for the average of
800
Jan/June 2020 (vs Oct 2019):
760
2017
Palm oil (fob Indo) US-$ 600 (510) 720
680
Soya oil (fob Arg.) US-$ 730 (665)
640
Sun oil (fob Black Sea) $750 (690) 600
2018
560
The forecasts are averages for 520
2019
Jan/June 2020. Palm oil prices 480

(fob Indonesia) could 440
temporarily rise to US $ 650-700. 400
Jan Feb Mar Apr May Jun Jly Aug Sep Oct Nov Dec
Oct 31, 2019

Monthly Prices of 4 Oils (in US-$/T) ● Forecasts for the average of

1600
Jan/June 2020 (vs Oct 2019) in
SBO Dutc h
1400
Sun oil E U Rotterdam:
Rape oil Dutc h
1200
CPO ci f R'da m Palm oil (Rott.) US-$ 660 (565)
1000
800
600
400
200
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
January 2010 un til Oct 2019
Oct 31, 2019


Monthly Prices of Palm & Lauric Oils (in US-$/T) ● Lauric oil prices are forecast
2000
Palmker n el oil, Mal/In do ., cif Ro tt . to appreciate
Co con ut o il, Phil/In do. c if Ro tt.
1800 CPO cif R'd am
1600 ● Forecasts for the average of

1400
Jan/June 2020 (vs Oct 2019) in
Rotterdam:
1200
Palm oil (Rott.) US-$ 660 (565)
1000
800
PKernoil (Rott.) US $ 720 (590)
600 Coconut oil (Rott.) $ 860 (716)
400
20 13 20 14 20 15 20 16 20 17 20 18 20 19
January 2013 until O ct 2019
Oct 31, 2019

Thank You for Your Attention!

More market info required? Kindly get in touch with me:
Thomas.Mielke@oilworld.de
fon +49 40 761 05021
© Copyright 2019 ISTA Mielke GmbH.

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ensure the accuracy and completeness of the contents. We cannot, however, accept any responsibility
for them nor for the accuracy of our forecasts and opinions or any liability for the subscriber’s use. Oct 31, 2019
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Thomas Mielke, for more info www.oilworld.

de IPOC 2019 - Palm Oil Price Outlook on 1 Nov 2019

Global Supply, Demand and Price Outlook

Indonesian Palm Oil Conference IPOC 2019 in Bali on Oct 31 – Nov 1

Thomas Mielke, ISTA Mielke GmbH, Oil World,

Feel free to contact me for assistance at <thomas.mielke@oilworld.de>

Oct 31, 2019

Company Profil and Services

• Daily, weekly and monthly publications as described on www.oilworld.de

• Individual customer support. If you need assistance, email to Thomas.Mielke@oilworld.de

• Take a free 3-week trial and contact info@oilworld.de

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 1

Oct 31, 2019

Weekly Prices of Palm Oil, fob Indonesia (US-$/T)

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 2

Oct 31, 2019

Indonesia holds a major key for the future

In 2020 with full implementation of B-30, 3

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 3

PALM OIL Outlook:

Oct 31, 2019

World PALM OIL Outlook

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 4

The Dominance of Palm Oil and of Soya oil

Oct 31, 2019

The 40-Year Success Palm Oil Production 1980 - 2019

Source: ISTA Mielke GmbH, Oil World 5

Palm Oil Losing Competitiveness Yield increases in the past 15 years:

Oct 31, 2019

PALM OIL Outlook: PALM OIL : Production in Key Countries (Mn T)

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 6

Oct 31, 2019

Record soybean stocks in S o yb e a n s : W o r ld S to ck s a s o f e n d -A u g u st (M n T )

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 7

Impacts of the Trade War China - USA

Oct 31, 2019

Impacts of the Trade War China - USA

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 8

Trade War Impacts on Oils & Fats

China is increasing CHINA, P .R.: Imports of 17 Oils & Fats (1000 T)

Oct 31, 2019

CHINA, P.R.: 17 Oils & Fats

Source: ISTA Mielke GmbH, Oil World 9

World production on a RAPESEED & C ANOLA

Oct 31, 2019

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 10

Substantial Growth in World Demand of Oils/Fats

Oct 31, 2019

Biodiesel and HVO

Driven by Indonesia, about 18.5 Mn T of

Oct 31, 2019

Source: ISTA Mielke GmbH, Oil World 11

Importance of palm oil in global oils & fats market

Oct 31, 2019

PALM OIL : Imports of Major Countries (1000 T)

Oct 31, 2019