POGO spread seen keeping palm oil out of Europe through H1 2021

In Singapore, Platts reports that the POGO spread, which determines voluntary biodiesel blending based on the prices of palm oil and heating oil, is between $400 and $500 per metric ton, effectively locking out Malaysian and Indonesian palm oil exports from Europe through H1. The POGO spread kept discretionary blending from being viable for most of 2020. Since they can’t rely on exports, both countries will seek to boost domestic blending to absorb the excess supplies but high palm oil prices and low fuel consumption due to COVID-19 will reign in those ambitions as well.