KUALA LUMPUR, Aug. 16 (Xinhua) -- BMI, a unit of Fitch Solutions, on Wednesday held to its average price forecast of 3,800 ringgit (819 U.S. dollars) per ton for Bursa Malaysia-listed third-month palm oil futures contracts in 2023.
The Fitch research house said in a note that it also held its forecast for 2024, anticipating average palm oil prices of 3,400 ringgit per ton.
Up to the time of writing, the contracts have traded at an average price level of 3,804 ringgit per ton on a year-to-date basis and at an average price level of 3,753 ringgit per ton through the third quarter.
According to the research house, the current El Nino event poses a major upside risk to its average palm oil price outlook over the next 12 to 18 months.
Much depends on the eventual strength of the El Nino event itself, it said.
It also forecasts that global palm oil production will increase by 3.6 percent year on year to 80 million tons and that global palm oil consumption will increase by 3.7 percent year on year to 78.9 million tons in 2023/24, which will see the global palm oil balance remain more-or-less unchanged when compared to the estimated 1.1 million tons surplus achieved in 2022/23.
Through the medium term, BMI maintains its view that average annual palm oil prices will continue to ease. (1 ringgit equals 0.22 U.S. dollars) ■