Vegetable oil prices will increase from $ 50 to $ 100 per ton by June: Fry analyst

(Reuters) – Vegetable oil prices, including palm oil, are expected to rise from $ 50 to $ 100 per tonne by June, according to industry badyst James Fry's forecast .

"The prices of crude palm oil and other oils depend on the prospects of palm stocks. Stocks will drop until the middle of the year, pushing the gross palm oil premium above Brent, especially if Indonesia continues to grow faster in terms of biodiesel consumption According to Fry's presentation at a conference on industry in Karachi and seen by Reuters.

"If that happens, there will be a gain of 50 to 100 US dollars for oils by June," said Fry, president of the commodity consulting firm LMC International. Crude oil benchmarks set the price floor for vegetable oil, Fry said.

Palm oil benchmark prices fell to their lowest levels in three years in November and December, due to high inventories and weak demand. Palm was up 1.1% at 2223 ringgits ($ 540.88) a tonne on Friday night. [POI/]

Palm oil stocks in Southeast Asia reached record levels last year due to weak demand, but are expected to ease over the next few months, in line with recent developments. seasonal trends in production.

Palm oil stocks in Indonesia, the world's largest producer, reached 3.9 million tonnes in November, after peaking at nearly 5 million tonnes in July. The second largest producer, Malaysia's stocks climbed to a record 3.2 million tonnes in December.

In order to boost the consumption of palm oil, Indonesia decided last year, as part of its biodiesel mandate, to require all diesel fuel used in the country to contain biodiesel from from the beginning of September.

Indonesia's mandate includes a biodiesel content of 20% in biodiesel, but it was mandatory before September for subsidized diesel users.

Julian McGill, director of LMC International for Southeast Asia, said Thursday at an industry conference that crude palm oil prices are expected to increase between 2200 and 2300 ringgits per ton by June, due to a seasonal decline in inventories.