MARKET DEVELOPMENT
VEGOILS-Palm Dips on Profit-taking But Monsoon Floods Support
VEGOILS-Palm Dips on Profit-taking But Monsoon Floods Support
06/12/2013 (Reuters) - Malaysian palm oil futures ended lower on Thursday as investors booked profits from gains in the previous session, but prices were held up by worries that flooding in major palm-growing areas would disrupt output in the world's No.2 producer.
The monsoon season, which brought heavy rains and thunderstorms over most parts of Peninsular Malaysia, has caused severe floods in low-lying areas where the chunk of the country's oil palm is grown.
More than 30,000 people have been evacuated so far as floods worsen in the Malaysian states of Johor, Pahang and Terengganu.The Malaysian Meteorological Department, as quoted by local media, warned that there might not be any reprieve for now due to high tides and rough seas.
Although rainfall has lessened across some states for now, it would take several days for flood waters to subside. The rising waters have disrupted harvesting of fresh fruit bunches and cut off transportation to mills.
"There's some profit-taking going on today. But the damage that the floods have done is actually bad and there could be more rains to come," said a trader with a local commodities brokerage.
"Logistics are a problem. In some areas the palm oil tankers cannot get in or out. There's some sunshine today, but I'm told the floods could worsen," the Malaysian-based trader added.
The benchmark February contract on the Bursa Malaysia Derivatives Exchange had edged down 0.6 percent to 2,641 ringgit ($818) per tonne by Thursday's close. Prices on Wednesday rose as high as 2,662 ringgit, spurring investors to book profits from gains.
Total traded volume, however, stood at 27,711 lots of 25 tonnes, below the average 35,000 lots as some investors chose to wait for a clearer picture on the flood situation.
Malaysian palm oil stocks likely rose to 1.98 million tonnes in November, a Reuters survey showed, as a dent in production did little to offset softer winter demand for the tropical oil.
Exports were seen falling 4.0 percent from a month ago to 1.59 million tonnes, according to the survey, while output was estimated to drop 1 percent to 1.95 million tonnes.
In other markets, Brent crude edged lower towards $111 a barrel on Thursday, after OPEC agreed to renew a collective oil production cap and some members talked about raising output next year.
In competing vegetable oil markets, the U.S. soyoil contract for December rose 0.1 percent in late Asian trade. The most active May soybean oil contract on the Dalian Commodities Exchange fell 0.7 percent.
Palm, soy and crude oil prices at 1007 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC3 2605 -1.00 2595 2646 74
MY PALM OIL JAN4 2629 -13.00 2618 2637 2378
MY PALM OIL FEB4 2641 -15.00 2627 2653 13946
CHINA PALM OLEIN MAY4 6160 -80.00 6158 6296 895292
CHINA SOYOIL MAY4 7204 -52.00 7202 7306 885256
CBOT SOY OIL JAN4 40.14 -0.21 40.06 40.49 3203
NYMEX CRUDE JAN4 97.49 +0.29 97.01 97.72 12654
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=3.23 Malaysian ringgit)
The monsoon season, which brought heavy rains and thunderstorms over most parts of Peninsular Malaysia, has caused severe floods in low-lying areas where the chunk of the country's oil palm is grown.
More than 30,000 people have been evacuated so far as floods worsen in the Malaysian states of Johor, Pahang and Terengganu.The Malaysian Meteorological Department, as quoted by local media, warned that there might not be any reprieve for now due to high tides and rough seas.
Although rainfall has lessened across some states for now, it would take several days for flood waters to subside. The rising waters have disrupted harvesting of fresh fruit bunches and cut off transportation to mills.
"There's some profit-taking going on today. But the damage that the floods have done is actually bad and there could be more rains to come," said a trader with a local commodities brokerage.
"Logistics are a problem. In some areas the palm oil tankers cannot get in or out. There's some sunshine today, but I'm told the floods could worsen," the Malaysian-based trader added.
The benchmark February contract on the Bursa Malaysia Derivatives Exchange had edged down 0.6 percent to 2,641 ringgit ($818) per tonne by Thursday's close. Prices on Wednesday rose as high as 2,662 ringgit, spurring investors to book profits from gains.
Total traded volume, however, stood at 27,711 lots of 25 tonnes, below the average 35,000 lots as some investors chose to wait for a clearer picture on the flood situation.
Malaysian palm oil stocks likely rose to 1.98 million tonnes in November, a Reuters survey showed, as a dent in production did little to offset softer winter demand for the tropical oil.
Exports were seen falling 4.0 percent from a month ago to 1.59 million tonnes, according to the survey, while output was estimated to drop 1 percent to 1.95 million tonnes.
In other markets, Brent crude edged lower towards $111 a barrel on Thursday, after OPEC agreed to renew a collective oil production cap and some members talked about raising output next year.
In competing vegetable oil markets, the U.S. soyoil contract for December rose 0.1 percent in late Asian trade. The most active May soybean oil contract on the Dalian Commodities Exchange fell 0.7 percent.
Palm, soy and crude oil prices at 1007 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC3 2605 -1.00 2595 2646 74
MY PALM OIL JAN4 2629 -13.00 2618 2637 2378
MY PALM OIL FEB4 2641 -15.00 2627 2653 13946
CHINA PALM OLEIN MAY4 6160 -80.00 6158 6296 895292
CHINA SOYOIL MAY4 7204 -52.00 7202 7306 885256
CBOT SOY OIL JAN4 40.14 -0.21 40.06 40.49 3203
NYMEX CRUDE JAN4 97.49 +0.29 97.01 97.72 12654
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=3.23 Malaysian ringgit)