MARKET DEVELOPMENT
Palm Trades Near 14-Month High as Exports Signal Demand Recovery
Palm Trades Near 14-Month High as Exports Signal Demand Recovery
26/11/2013 (Bloomberg) - Palm oil climbed toward a 14-month high as data showed demand is increasing for supplies from Malaysia, the world’s second-biggest producer.
The contract for delivery in February advanced as much as 0.8 percent to 2,664 ringgit ($825) a metric ton on the Bursa Malaysia Derivatives, and ended the morning session at 2,656 ringgit. Futures rallied to 2,692 ringgit on Nov. 22, the highest level for the most-active contract since September 2012, extending a bull market on concern that output will trail analysts’ estimates for Indonesia, the biggest supplier.
Shipments from Malaysia totaled 1.23 million tons in the first 25 days of November, little changed from the same period a month earlier and rebounding from a 13 percent decline in the first 10 days, data from surveyor Intertek showed. Stockpiles at major ports in China were at 880,000 tons in the week of Nov. 5, the lowest this year, according to state-owned researcher Grain.gov.cn.
“China and India probably need to increase their inventory, and at current prices it’s still quite attractive for them,” said Benny Lee, a market strategist at Jupiter Securities in Kuala Lumpur. “Demand will start to improve, so there’s still potential upside for prices.”
Cooking oil inventories at ports and pipelines in India were at 1.4 million tons at the beginning of this month, the lowest level since February 2012, according to the Solvent Extractors’ Association of India.
Indonesia raised its palm oil export tax to 12 percent for December from 9 percent this month, Faiz Achmad, director of food and industry at the Industry Ministry said today. Malaysia increased its duty on shipments to 5 percent for next month.
Refined palm oil for May delivery gained 0.3 percent to 6,456 yuan ($1,058) a ton on the Dalian Commodity Exchange. Soybean oil climbed 0.4 percent to 7,328 yuan.
Soybeans for January delivery lost 0.3 percent to $13.1575 a bushel on the Chicago Board of Trade. Soybean oil gained 0.2 percent to 41.52 cents a pound.
The contract for delivery in February advanced as much as 0.8 percent to 2,664 ringgit ($825) a metric ton on the Bursa Malaysia Derivatives, and ended the morning session at 2,656 ringgit. Futures rallied to 2,692 ringgit on Nov. 22, the highest level for the most-active contract since September 2012, extending a bull market on concern that output will trail analysts’ estimates for Indonesia, the biggest supplier.
Shipments from Malaysia totaled 1.23 million tons in the first 25 days of November, little changed from the same period a month earlier and rebounding from a 13 percent decline in the first 10 days, data from surveyor Intertek showed. Stockpiles at major ports in China were at 880,000 tons in the week of Nov. 5, the lowest this year, according to state-owned researcher Grain.gov.cn.
“China and India probably need to increase their inventory, and at current prices it’s still quite attractive for them,” said Benny Lee, a market strategist at Jupiter Securities in Kuala Lumpur. “Demand will start to improve, so there’s still potential upside for prices.”
Cooking oil inventories at ports and pipelines in India were at 1.4 million tons at the beginning of this month, the lowest level since February 2012, according to the Solvent Extractors’ Association of India.
Indonesia raised its palm oil export tax to 12 percent for December from 9 percent this month, Faiz Achmad, director of food and industry at the Industry Ministry said today. Malaysia increased its duty on shipments to 5 percent for next month.
Refined palm oil for May delivery gained 0.3 percent to 6,456 yuan ($1,058) a ton on the Dalian Commodity Exchange. Soybean oil climbed 0.4 percent to 7,328 yuan.
Soybeans for January delivery lost 0.3 percent to $13.1575 a bushel on the Chicago Board of Trade. Soybean oil gained 0.2 percent to 41.52 cents a pound.