MARKET DEVELOPMENT
VEGOILS-Palm Hits 2-Mth high As Weather Concerns Linger
VEGOILS-Palm Hits 2-Mth high As Weather Concerns Linger
28/08/2013 (Reuters) - Malaysian palm oil futures climbed to the highest in more than two months on Tuesday as concerns lingered over dry weather damaging soy crops in the U.S. Midwest.
Forecasts for stressful weather in the U.S. farm belt had boosted palm oil prices by as much as 3.5 percent on Monday, as a smaller amount of soybeans for crushing into edible oil could shift some demand to the palm-based variety.
Gains were relatively muted on Tuesday, with analysts warning prices at new highs may trigger some profit-taking.
"We can see a large bullish gap up in previous day trading, with prices breaking through at 2,398 ringgit as it proceeded to test the resistance level at 2,500," said Singapore-based Phillip Futures in a note on Tuesday.
"However, we expect prices to lose support as current bull factors are short-term and we may expect a sell-off by investors at the current good price level."
At the market close, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had pulled back from the intraday high to 2,452 ringgit ($736) per tonne, up 0.7 percent.
Prices earlier hit 2,468 ringgit, a level unseen since June 20. Total traded volume stood at 43,982 lots of 25 tonnes each, well above the average 35,000 lots.
Technicals showed a bullish target at 2,491 ringgit per tonne remains unchanged for palm oil, as it has cleared a resistance at 2,407 ringgit, said Reuters market analyst Wang Tao.
Malaysia's palm export demand remained resilient with cargo surveyors reporting a 7.1-7.5 percent increase in Aug. 1-25 shipments from the same period a month ago, supported by stronger demand from Europe, India and China.
In other markets, Brent crude rose above $111 a barrel on Tuesday as rising tension over a suspected chemical weapons attack in Syria raised the prospect of Western military action in the Middle East.
In vegetable oil markets, the U.S. soyoil contract for December lost 0.2 percent in late Asian trade. The most-active January soybean oil contract on the Dalian
Commodities Exchange climbed 1.3 percent.
Palm, soy and crude oil prices at 1002 GMT
Contract Month Last Change Low High Volume
MY PALM OIL SEP3 2474 -9.00 2457 2502 268
MY PALM OIL OCT3 2460 +11.00 2445 2479 5113
MY PALM OIL NOV3 2452 +18.00 2434 2468 20978
CHINA PALM OLEIN JAN4 5826 +98.00 5778 5862 623748
CHINA SOYOIL JAN4 7410 +94.00 7360 7462 867302
CBOT SOY OIL DEC3 44.78 -0.10 44.49 45.17 9413
NYMEX CRUDE OCT3 106.86 +0.94 105.88 106.91 16538
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=3.33 Malaysian ringgit)
Forecasts for stressful weather in the U.S. farm belt had boosted palm oil prices by as much as 3.5 percent on Monday, as a smaller amount of soybeans for crushing into edible oil could shift some demand to the palm-based variety.
Gains were relatively muted on Tuesday, with analysts warning prices at new highs may trigger some profit-taking.
"We can see a large bullish gap up in previous day trading, with prices breaking through at 2,398 ringgit as it proceeded to test the resistance level at 2,500," said Singapore-based Phillip Futures in a note on Tuesday.
"However, we expect prices to lose support as current bull factors are short-term and we may expect a sell-off by investors at the current good price level."
At the market close, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had pulled back from the intraday high to 2,452 ringgit ($736) per tonne, up 0.7 percent.
Prices earlier hit 2,468 ringgit, a level unseen since June 20. Total traded volume stood at 43,982 lots of 25 tonnes each, well above the average 35,000 lots.
Technicals showed a bullish target at 2,491 ringgit per tonne remains unchanged for palm oil, as it has cleared a resistance at 2,407 ringgit, said Reuters market analyst Wang Tao.
Malaysia's palm export demand remained resilient with cargo surveyors reporting a 7.1-7.5 percent increase in Aug. 1-25 shipments from the same period a month ago, supported by stronger demand from Europe, India and China.
In other markets, Brent crude rose above $111 a barrel on Tuesday as rising tension over a suspected chemical weapons attack in Syria raised the prospect of Western military action in the Middle East.
In vegetable oil markets, the U.S. soyoil contract for December lost 0.2 percent in late Asian trade. The most-active January soybean oil contract on the Dalian
Commodities Exchange climbed 1.3 percent.
Palm, soy and crude oil prices at 1002 GMT
Contract Month Last Change Low High Volume
MY PALM OIL SEP3 2474 -9.00 2457 2502 268
MY PALM OIL OCT3 2460 +11.00 2445 2479 5113
MY PALM OIL NOV3 2452 +18.00 2434 2468 20978
CHINA PALM OLEIN JAN4 5826 +98.00 5778 5862 623748
CHINA SOYOIL JAN4 7410 +94.00 7360 7462 867302
CBOT SOY OIL DEC3 44.78 -0.10 44.49 45.17 9413
NYMEX CRUDE OCT3 106.86 +0.94 105.88 106.91 16538
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=3.33 Malaysian ringgit)