22/06/2012 (Hindu Business Line) - Palmolein’s rally came to a halt on Thursday, tracking weak closing of Malaysian palm oil futures. Other edible oils extended gains despite lower demand.

Soya refined and sunflower expeller refined oil rose by Rs 5 for 10-kg each. Rapeseed oil and cotton refined oil were up by Rs 4 each. Groundnut oil declined by Rs 10 on bearish reports from Saurashtra. Palmolein ruled steady on eased demand with nominal volume. Palm oil touched a near three-week high on Wednesday. But some traders said that the price rally had set the stage for a price correction.

Rising palm oil exports confirmed stronger demand for the tropical oil ahead of Ramadan that starts in July. Malaysian palm oil exports grew 15 per cent in the first 20 days of the month. Another supportive factor for palm oil is the dry weather in the US. The USDA said that unfavourable weather had damaged soyabean crop quality. A lower soyabean crop will result in more demand for cheaper palm oil.

Sources said that with mood being cautious, activities remain limited. Only needy buyers bought about 250-300 tonnes of palmolein in the range of Rs 600-603. Ruchi sold about 100-150 tonnes and rest was traded in resale.

Weak Indian currency will make import parity costlier will force refiners to hold the rates. Liberty quoted palmolein at Rs 607-608, super palmolein at Rs 640, soya oil at Rs 715 and sunflower refined oil at Rs 730. Ruchi quoted palmolein at Rs 605 for July and Rs 610 for August 1-15, soya refined oil at Rs 715 for July 15 and Rs 718 for July 15-31. Sunflower refined oil was offered at Rs 725-728. Allana’s rate for palmolein was Rs 608 for July 15-31. Bunge quoted palmolein at Rs 610 for July 1-20. In Saurashtra - Rajkot market, groundnut oil declined by Rs 30 to Rs 1,890 for Telia tin and dropped by Rs 20 to Rs 1,230 for loose - 10kg.

Malaysia's crude palm oil July contracts settled at MYR 2,984 (MYR 3,035), August at MYR 2,996 (MRY 3,045) and September at MYR 3,000 (MYR 3,041) a tonne. On the National Board of Trade – Indore, Soya refined oil July futures closed at Rs 750.30 (Rs 749.10).

The Bombay Commodity Exchange spot rates were (Rs/10 kg): groundnut oil 1,190 (1,200), soya refined oil 715 (710), sunflower exp. ref. 660 (655), sunflower ref. 725 (725), rapeseed ref. oil 812 (808), rapeseed expeller ref. 782 (778) cotton ref. oil 690 (686) and palmolein 601 (601).