Edible oil prices to decline as demand destruction ushers in bearish phase

Shutdown of factories, hotels and restaurants, and a sharp decline in crude prices have all contributed to demand destruction.

Edible oil prices are set to move into a strong bearish phase in the next few months due to demand destruction across all major consuming sectors following the global shutdown of factories, hotels and restaurants. Another major reason for the fall is the sharp decline in crude oil prices, which hit palm oil demand forbiodiesel consumption.

Crude palm oil futures for delivery (January to April) declined by 28 per cent so far this calendar year to trade currently at 2,088 ringgit in the benchmark Bursa Malaysia compared to 2,897 ringgit reported on January 1.

Speaking at a webinar, Dorab Mistry, director, Godrej