Indian Refiners Cancel Palm Oil Orders on Price Surge

A Reuters report datelined Mumbai, February 20 has said Indian refiners have cancelled orders for 70,000 MT of crude palm oil (CPO) scheduled for delivery between March and June, because of a surge in benchmark Malaysian prices and negative refining margins in India, quoting four trade sources.  
Refiners in India, the world’s largest importer of palm oil, cancelled imports after Malaysian palm oil futures rose more than 11% over four weeks.  The cancellation is anticipated to limit the rally in Malaysian palm oil prices, although they could also support soya oil prices as some refiners shift to soya oil, the report said.
According to an Indian buyer, who operates a refinery on the east coast and cancelled palm oil shipments for March delivery, the combination of negative refining margins in India and high overseas prices meant it made sense to lock in profits by selling palm oil back to suppliers, rather than importing it, Reuters wrote.