MARKET DEVELOPMENT
VEGOILS-Palm Hits 1-mth High on Weaker-Than-Expected Stocks, Output
VEGOILS-Palm Hits 1-mth High on Weaker-Than-Expected Stocks, Output
11/10/2013 (Reuters) - Malaysian palm oil futures climbed to their highest in more than a month on Thursday, reversing the morning's losses and posting their fifth straight day of gains after an industry report showed inventories in September were less than expected.
Palm oil stocks in Malaysia, the world's second-largest producer, notched a smaller-than-expected rise in September as output of the tropical oil grew more slowly than anticipated, data from the Malaysian Palm Oil Board showed on Thursday.
Production rose 10.2 percent, less than the 15 percent rise forecast in a Reuters poll of traders and plantation firms.
End-stocks rose 7 percent to 1.78 million tonnes, below estimates for a 14.8 percent rise to 1.91 million tonnes.
"From this report we can conclude that prices henceforth will rally towards 2,600 ringgit by the fourth quarter of 2013," said a trader with a local commodities brokerage in Malaysia.
The benchmark December contract on the Bursa Malaysia Derivatives Exchange climbed as high as 2,394 ringgit ($750) in afternoon trading, its highest since Sept. 9. The contract closed at 2,388 ringgit, up 0.9 percent.
Total traded volume stood at 35,454 lots of 25 tonnes each, compared to the usual 35,000 lots.
Technicals showed Malaysian palm oil still targets 2,401 ringgit per tonne, as indicated by an inverted head-and-shoulders and a Fibonacci retracement analysis, Reuters market analyst Wang Tao said.
Demand for palm oil has been robust, thanks to Hindu and Muslim religious festivals that will be celebrated in November.
Festive demand typically drives up consumption of the tropical oil commonly used in many food products including biscuits, chocolate and ice cream.
Cargo surveyor data earlier showed that exports of the tropical oil surged 17.2 percent in the Oct. 1-10 period compared to a month ago, thanks to increased purchases from the world's top two palm oil buyers, India and China.
Another cargo surveyor Societe Generale de Surveillance will release data for the same period late Thursday.
In other markets, Brent crude oil rose to near $110 per barrel as the kidnapping of Libya's prime minister delayed the prospect of a further recovery in production from the North African nation.
In competing vegetable oil markets, the U.S. soyoil contract for December rose 0.8 percent in late Asian trade. The most-active January soybean oil contract on the Dalian Commodities Exchange rose 0.6 percent.
Palm, soy and crude oil prices at 1023 GMT
Contract Month Last Change Low High Volume
MY PALM OIL OCT3 2390 +21.00 2380 2390 58
MY PALM OIL NOV3 2390 +22.00 2360 2391 1698
MY PALM OIL DEC3 2388 +19.00 2359 2394 15761
CHINA PALM OLEIN JAN4 5610 +74.00 5530 5632 511818
CHINA SOYOIL JAN4 7096 +40.00 7058 7104 628370
CBOT SOY OIL DEC3 41.00 +0.33 40.66 41.18 8241
NYMEX CRUDE NOV3 102.02 +0.42 101.39 102.27 23370
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
Crude in U.S. dollars per barrel
($1 = 3.200 ringgit)
Palm oil stocks in Malaysia, the world's second-largest producer, notched a smaller-than-expected rise in September as output of the tropical oil grew more slowly than anticipated, data from the Malaysian Palm Oil Board showed on Thursday.
Production rose 10.2 percent, less than the 15 percent rise forecast in a Reuters poll of traders and plantation firms.
End-stocks rose 7 percent to 1.78 million tonnes, below estimates for a 14.8 percent rise to 1.91 million tonnes.
"From this report we can conclude that prices henceforth will rally towards 2,600 ringgit by the fourth quarter of 2013," said a trader with a local commodities brokerage in Malaysia.
The benchmark December contract on the Bursa Malaysia Derivatives Exchange climbed as high as 2,394 ringgit ($750) in afternoon trading, its highest since Sept. 9. The contract closed at 2,388 ringgit, up 0.9 percent.
Total traded volume stood at 35,454 lots of 25 tonnes each, compared to the usual 35,000 lots.
Technicals showed Malaysian palm oil still targets 2,401 ringgit per tonne, as indicated by an inverted head-and-shoulders and a Fibonacci retracement analysis, Reuters market analyst Wang Tao said.
Demand for palm oil has been robust, thanks to Hindu and Muslim religious festivals that will be celebrated in November.
Festive demand typically drives up consumption of the tropical oil commonly used in many food products including biscuits, chocolate and ice cream.
Cargo surveyor data earlier showed that exports of the tropical oil surged 17.2 percent in the Oct. 1-10 period compared to a month ago, thanks to increased purchases from the world's top two palm oil buyers, India and China.
Another cargo surveyor Societe Generale de Surveillance will release data for the same period late Thursday.
In other markets, Brent crude oil rose to near $110 per barrel as the kidnapping of Libya's prime minister delayed the prospect of a further recovery in production from the North African nation.
In competing vegetable oil markets, the U.S. soyoil contract for December rose 0.8 percent in late Asian trade. The most-active January soybean oil contract on the Dalian Commodities Exchange rose 0.6 percent.
Palm, soy and crude oil prices at 1023 GMT
Contract Month Last Change Low High Volume
MY PALM OIL OCT3 2390 +21.00 2380 2390 58
MY PALM OIL NOV3 2390 +22.00 2360 2391 1698
MY PALM OIL DEC3 2388 +19.00 2359 2394 15761
CHINA PALM OLEIN JAN4 5610 +74.00 5530 5632 511818
CHINA SOYOIL JAN4 7096 +40.00 7058 7104 628370
CBOT SOY OIL DEC3 41.00 +0.33 40.66 41.18 8241
NYMEX CRUDE NOV3 102.02 +0.42 101.39 102.27 23370
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
Crude in U.S. dollars per barrel
($1 = 3.200 ringgit)