MARKET DEVELOPMENT
VEGOILS-Palm Edges up as Ringgit Weakens, But Posts 2nd Weekly Drop
VEGOILS-Palm Edges up as Ringgit Weakens, But Posts 2nd Weekly Drop
(Updates prices, adds paragraph and quote on Indonesian biodiesel levy)
* Prices down 1.7 pct in 2nd weekly fall
* Ringgit down 0.8 pct to 3.7390 per dollar
* Palm production seen easing during Ramadan - traders
* Indonesia looking to impose $20/T levy on biodiesel - minister
19/06/2015 (Reuters) - Malaysian palm oil futures recovered after hitting three-week lows on Friday as the ringgit eased, although steep losses earlier this week dragged the tropical oil to its second straight weekly loss.
Market players are also anticipating crude palm oil production in Malaysia, the world's second-largest grower,
to weaken during the Muslim holy month of Ramadan as plantation workers go on holiday.
"Market is seeing good buying interest at current levels," said Lingam Supramaniam, director at Malaysia-based commodities firm Pelindung Bestari. "After the recent selloff, the worry on production in June and July are keeping buyers alert."
The Malaysian ringgit dipped 0.8 percent on Friday, after rising to 3.7015 against the dollar in the previous session. A cheaper ringgit makes palm an attractive option for overseas customers.
The September palm oil contract on the Bursa Malaysia Derivatives exchange slipped to 2,227 ringgit a tonne in early trade, its lowest since May 29, before settling 0.1 percent higher at 2,240 ringgit ($599.09) by Friday's close.
The pull-up was not enough to prevent palm from another weekly fall. Prices for the week were down 1.7 percent.
Total traded volume stood at 32,548 lots of 25 tonnes each, below the usual 35,000 lots.
The holy month of Ramadan, which is observed by fasting and feasting, began on Thursday and will be followed by the Eid al-Fitr celebrations in mid-July.
The festival typically drives up consumption of edible oils, including in top palm growers Indonesia and Malaysia, both Muslim-majority countries.
The market is also keeping a watch on cargo surveyor export data for overseas shipments of palm oil between June 1-20, due to be released on Saturday.
"If exports maintain the pace or are slightly lower than May, there might be some drawdown in end-stocks," said a trader with a foreign commodities brokerage in Kuala Lumpur. "And I don't think you can import from Indonesia, as they'll need the oil for themselves."
Indonesia is considering levies on 24 palm products, including kernel shells and biodiesel, in a regulation that will take effect from July 1, senior government officials said.
The range of the levies will be between $10 and $50, and the levy considered for biodiesel is $20 per tonne, Minister of Industry Saleh Husin said.
Indonesian crude palm oil Public Service Agency President-Director Bayu Krisnamurthi said the levies are
unlikely to impact Indonesia's biodiesel competitiveness in the global markets.
"On the other hand, we are creating a new huge domestic market...we are encouraging higher domestic consumption," he said.
In other markets, oil eased below $64 a barrel on Friday as concern over Greece and a forecast that U.S. shale oil output would keep growing this year countered signs of a pickup in demand.
The U.S. July soyoil contract rose 0.9 percent in late Asian trade, while the most active January soybean oil contract on the Dalian Commodity Exchange dropped 0.9 percent.
Palm, soy and crude oil prices at 1008 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JUL5 2235 +5.00 2222 2250 632
MY PALM OIL AUG5 2238 +1.00 2227 2258 4174
MY PALM OIL SEP5 2240 +3.00 2227 2260 18796
CHINA PALM OLEIN JAN6 5114 -32.00 5044 5124 664172
CHINA SOYOIL JAN6 5848 -54.00 5796 5868 499496
CBOT SOY OIL JUL5 32.54 -0.80 32.16 32.59 6385
INDIA PALM OIL JUN5 449.50 -0.80 449.50 453.20 375
INDIA SOYOIL JUN5 612.90 +2.90 610.80 613.30 3390
NYMEX CRUDE JUL5 59.74 -0.71 59.63 60.56 8356
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
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel
($1 = 3.7390 ringgit)
($1 = 6.2095 Chinese yuan)
($1 = 63.60 Indian rupees)
* Prices down 1.7 pct in 2nd weekly fall
* Ringgit down 0.8 pct to 3.7390 per dollar
* Palm production seen easing during Ramadan - traders
* Indonesia looking to impose $20/T levy on biodiesel - minister
19/06/2015 (Reuters) - Malaysian palm oil futures recovered after hitting three-week lows on Friday as the ringgit eased, although steep losses earlier this week dragged the tropical oil to its second straight weekly loss.
Market players are also anticipating crude palm oil production in Malaysia, the world's second-largest grower,
to weaken during the Muslim holy month of Ramadan as plantation workers go on holiday.
"Market is seeing good buying interest at current levels," said Lingam Supramaniam, director at Malaysia-based commodities firm Pelindung Bestari. "After the recent selloff, the worry on production in June and July are keeping buyers alert."
The Malaysian ringgit dipped 0.8 percent on Friday, after rising to 3.7015 against the dollar in the previous session. A cheaper ringgit makes palm an attractive option for overseas customers.
The September palm oil contract on the Bursa Malaysia Derivatives exchange slipped to 2,227 ringgit a tonne in early trade, its lowest since May 29, before settling 0.1 percent higher at 2,240 ringgit ($599.09) by Friday's close.
The pull-up was not enough to prevent palm from another weekly fall. Prices for the week were down 1.7 percent.
Total traded volume stood at 32,548 lots of 25 tonnes each, below the usual 35,000 lots.
The holy month of Ramadan, which is observed by fasting and feasting, began on Thursday and will be followed by the Eid al-Fitr celebrations in mid-July.
The festival typically drives up consumption of edible oils, including in top palm growers Indonesia and Malaysia, both Muslim-majority countries.
The market is also keeping a watch on cargo surveyor export data for overseas shipments of palm oil between June 1-20, due to be released on Saturday.
"If exports maintain the pace or are slightly lower than May, there might be some drawdown in end-stocks," said a trader with a foreign commodities brokerage in Kuala Lumpur. "And I don't think you can import from Indonesia, as they'll need the oil for themselves."
Indonesia is considering levies on 24 palm products, including kernel shells and biodiesel, in a regulation that will take effect from July 1, senior government officials said.
The range of the levies will be between $10 and $50, and the levy considered for biodiesel is $20 per tonne, Minister of Industry Saleh Husin said.
Indonesian crude palm oil Public Service Agency President-Director Bayu Krisnamurthi said the levies are
unlikely to impact Indonesia's biodiesel competitiveness in the global markets.
"On the other hand, we are creating a new huge domestic market...we are encouraging higher domestic consumption," he said.
In other markets, oil eased below $64 a barrel on Friday as concern over Greece and a forecast that U.S. shale oil output would keep growing this year countered signs of a pickup in demand.
The U.S. July soyoil contract rose 0.9 percent in late Asian trade, while the most active January soybean oil contract on the Dalian Commodity Exchange dropped 0.9 percent.
Palm, soy and crude oil prices at 1008 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JUL5 2235 +5.00 2222 2250 632
MY PALM OIL AUG5 2238 +1.00 2227 2258 4174
MY PALM OIL SEP5 2240 +3.00 2227 2260 18796
CHINA PALM OLEIN JAN6 5114 -32.00 5044 5124 664172
CHINA SOYOIL JAN6 5848 -54.00 5796 5868 499496
CBOT SOY OIL JUL5 32.54 -0.80 32.16 32.59 6385
INDIA PALM OIL JUN5 449.50 -0.80 449.50 453.20 375
INDIA SOYOIL JUN5 612.90 +2.90 610.80 613.30 3390
NYMEX CRUDE JUL5 59.74 -0.71 59.63 60.56 8356
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
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel
($1 = 3.7390 ringgit)
($1 = 6.2095 Chinese yuan)
($1 = 63.60 Indian rupees)