US Fatty Acid Prices to Tumble in July 2022
- 24-Jun-2022 5:38 PM
- Journalist: Bob Duffler
Houston, USA: According to the monitoring data of ChemAnalyst, the price for Fatty acid has been sliding down for over a month now in the United States. The United States market showcased a decrement of approximately 8 per cent in June. Upstream Palm oil has continued to negatively impact all the Palm derivative commodities, as well as Fatty Acid.
The terminal user burden eased as the price of Palm oil has dropped to a six-month low and is anticipated to continue to fall. As per our market sources, Palm oil September contracts may tumbled by more than 9 per cent to around a thousand dollars. This downhill pricing will also probably give domestic surfactant, cosmetic and personal care players some relief from concerns over rapidly rising inflation.
Due to this dramatic drop in the price of Palm oil, FMCG firms in the United States like Johnson & Johnson, Proctor & Gamble, and Unilever would see their margins increase after nearly two years of constant inflation. When interviewed, a Louisiana-based trader mentioned to ChemAnalyst that the palm oil contract is seeing a bear run with renewed Chinese lockdowns and recent floods, which could result in weaker demand.
As Indonesia is speeding up shipments to clear excess palm oil supplies, on the other hand, Malaysia is struggling with reduced cargoes. According to the insights of a few significant firms, including ChemAnalyst, shipments of Malaysian palm oil products for the first twenty days of June have declined compared to a month earlier. Additionally, Indonesia established the reference price for crude palm oil for July at USD 1,616 per tonne, which would result in maximum export taxes and export levies of USD 200 per tonne and USD 288 per tonne, respectively.
Our analysts forecasted that the price trend of Fatty Acid in the United States might persistently witness correction in the upcoming weeks. However, the domestic Fatty Acid manufacturers were witnessing healthy consumer demand patterns this week with increased stockpiling activities in the country.