MARKET DEVELOPMENT
VEGOILS-Palm Hits 2-Month High, Worries Over US Soy Yield Support
VEGOILS-Palm Hits 2-Month High, Worries Over US Soy Yield Support
29/08/2013 (Reuters) - Malaysian palm oil futures rose to the highest in more than two months on Wednesday, as worries persisted over dry weather in the U.S. Midwest that could lead to lower soybean yields.
Palm oil has rallied 4.6 percent so far this week on concerns over tighter global oilseed supplies, as a smaller amount of soybeans for crushing into soybean oil could channel demand to competing palm oil.
Cargo surveyor data pointing to healthy export demand for the tropical oil also supported prices. Malaysian palm exports for the Aug. 1-25 period rose as much as 7.5 percent from a month ago, supported by stronger purchases from Europe, China
and India.
"Weather play is still lending some strength to the palm market, and there are also expectations that this month's exports should be higher than the previous month," said a trader with a foreign commodities brokerage in Kuala Lumpur.
"Palm oil will be testing the 2,500 ringgit level, but we might also see some profit-taking from the past few days' rally."
At market close, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had gained 1 percent to 2,477 ringgit ($743) per tonne, near its intraday high of 2,485 ringgit, a level unseen since June 20.
Total traded volume stood at 48,825 lots of 25 tonnes each, well above the average 35,000 lots.
Technicals showed palm oil may retrace moderately to 2,429 ringgit before rising towards 2,491 ringgit, as it faces a resistance at 2,462 ringgit, Reuters market analyst Wang Tao said.
Rising palm exports and potentially lower output in Malaysia, the world's No.2 palm producer, could help ease end-August stocks. Inventory levels inched up 1 percent to 1.66 million tonnes in end-July from a month ago.
In other markets, oil prices surged, with Brent pushing above $117 and the U.S. benchmark soaring to its highest in more than two years, amid worries a possible military strike against Syria may raise tensions in the Middle East.
In vegetable oil markets, the U.S. soyoil contract for December rose 0.2 percent in late Asian trade. The most-active January soybean oil contract on the Dalian Commodities Exchange lost 0.8 percent.
Palm, soy and crude oil prices at 1011 GMT
Contract Month Last Change Low High Volume
MY PALM OIL SEP3 2489 +23.00 2443 2489 730
MY PALM OIL OCT3 2488 +30.00 2447 2492 7507
MY PALM OIL NOV3 2477 +25.00 2441 2485 23208
CHINA PALM OLEIN JAN4 5724 -94.00 5700 5842 513300
CHINA SOYOIL JAN4 7332 -62.00 7330 7420 736912
CBOT SOY OIL DEC3 44.56 +0.04 44.36 44.74 8176
NYMEX CRUDE OCT3 109.97 +0.96 109.11 112.24 77176
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)
Palm oil has rallied 4.6 percent so far this week on concerns over tighter global oilseed supplies, as a smaller amount of soybeans for crushing into soybean oil could channel demand to competing palm oil.
Cargo surveyor data pointing to healthy export demand for the tropical oil also supported prices. Malaysian palm exports for the Aug. 1-25 period rose as much as 7.5 percent from a month ago, supported by stronger purchases from Europe, China
and India.
"Weather play is still lending some strength to the palm market, and there are also expectations that this month's exports should be higher than the previous month," said a trader with a foreign commodities brokerage in Kuala Lumpur.
"Palm oil will be testing the 2,500 ringgit level, but we might also see some profit-taking from the past few days' rally."
At market close, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had gained 1 percent to 2,477 ringgit ($743) per tonne, near its intraday high of 2,485 ringgit, a level unseen since June 20.
Total traded volume stood at 48,825 lots of 25 tonnes each, well above the average 35,000 lots.
Technicals showed palm oil may retrace moderately to 2,429 ringgit before rising towards 2,491 ringgit, as it faces a resistance at 2,462 ringgit, Reuters market analyst Wang Tao said.
Rising palm exports and potentially lower output in Malaysia, the world's No.2 palm producer, could help ease end-August stocks. Inventory levels inched up 1 percent to 1.66 million tonnes in end-July from a month ago.
In other markets, oil prices surged, with Brent pushing above $117 and the U.S. benchmark soaring to its highest in more than two years, amid worries a possible military strike against Syria may raise tensions in the Middle East.
In vegetable oil markets, the U.S. soyoil contract for December rose 0.2 percent in late Asian trade. The most-active January soybean oil contract on the Dalian Commodities Exchange lost 0.8 percent.
Palm, soy and crude oil prices at 1011 GMT
Contract Month Last Change Low High Volume
MY PALM OIL SEP3 2489 +23.00 2443 2489 730
MY PALM OIL OCT3 2488 +30.00 2447 2492 7507
MY PALM OIL NOV3 2477 +25.00 2441 2485 23208
CHINA PALM OLEIN JAN4 5724 -94.00 5700 5842 513300
CHINA SOYOIL JAN4 7332 -62.00 7330 7420 736912
CBOT SOY OIL DEC3 44.56 +0.04 44.36 44.74 8176
NYMEX CRUDE OCT3 109.97 +0.96 109.11 112.24 77176
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)