MARKET DEVELOPMENT
VEGOILS-Palm Ends at Near 6-Wk Low, Export Data Awaited
VEGOILS-Palm Ends at Near 6-Wk Low, Export Data Awaited
28/03/2014 (Reuters) - Malaysian palm oil futures fell to their lowest in almost six weeks on Thursday on sluggish demand for the tropical oil, with bearish signals on technical charts also dragging.
Market participants are waiting for export data for the full month of March, to be released next Monday, to gauge global demand for the vegetable oil.
"The market is still moving southwards ... technicals are looking bearish. We're looking at an immediate support level at 2,650 ringgit and a resistance level at 2,720 ringgit," said a trader with a foreign commodities brokerage.
"This month exports will probably fall 1-2 percent. We have to see whether exports improve."
The benchmark June contract on the Bursa Malaysia Derivatives Exchange had inched down 1.3 percent to 2,656 ringgit ($807) per tonne by Thursday's close. Prices earlier dipped to 2,652 ringgit in late trade, their lowest since Feb. 17.
Total traded volume stood at 51,693 lots of 25 tonnes, above the average 35,000 lots.
Cargo surveyor export data on Tuesday showed that Malaysia's palm oil shipments for March 1-25 fell about 11 percent compared with the same period in February after key consumers India and China cut back purchases.
Leading vegetable oil analysts and industry officials have warned that India, the world's biggest edible oil consumer, would likely reduce palm imports this year to buy more rival soyoil, as palm's discount continues to narrow.
A U.S. Department of Agriculture attache early Thursday forecast Malaysia's palm oil output to moderately rise to 20.35 million tonnes in 2014/15 due to a small increase in yields and plantation areas. Exports are projected to grow only marginally.
Benchmark Malaysian palm prices, which set the tone for global palm market, have lost more than 5 percent so far in March - their biggest drop since Feb. 2013. They are on course for their third straight weekly loss.
In other markets, Brent crude oil held steady around $107 a barrel on Thursday, underpinned by worries about potential supply disruption due to the possibility of Western sanctions on Russia's energy sector.
In other competing vegetable oil markets, the U.S. soyoil contract for May rose 0.1 percent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange gained 0.6 percent.
Palm, soy and crude oil prices at 1021 GMT
Contract Month Last Change Low High Volume
MY PALM OIL APR4 2744 -26.00 2736 2761 125
MY PALM OIL MAY4 2670 -39.00 2670 2716 5587
MY PALM OIL JUN4 2656 -35.00 2652 2695 23130
CHINA PALMOLEIN SEP4 6224 +28.00 6140 6256 575408
CHINA SOYOIL SEP4 6950 +40.00 6878 6974 635120
CBOT SOY OIL MAY4 40.77 +0.04 40.64 41.10 8532
NYMEX CRUDE MAY4 100.31 +0.05 100.03 100.41 13018
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 = 3.29 Malaysian ringgit)
($1 = 6.213 Chinese yuan)
Market participants are waiting for export data for the full month of March, to be released next Monday, to gauge global demand for the vegetable oil.
"The market is still moving southwards ... technicals are looking bearish. We're looking at an immediate support level at 2,650 ringgit and a resistance level at 2,720 ringgit," said a trader with a foreign commodities brokerage.
"This month exports will probably fall 1-2 percent. We have to see whether exports improve."
The benchmark June contract on the Bursa Malaysia Derivatives Exchange had inched down 1.3 percent to 2,656 ringgit ($807) per tonne by Thursday's close. Prices earlier dipped to 2,652 ringgit in late trade, their lowest since Feb. 17.
Total traded volume stood at 51,693 lots of 25 tonnes, above the average 35,000 lots.
Cargo surveyor export data on Tuesday showed that Malaysia's palm oil shipments for March 1-25 fell about 11 percent compared with the same period in February after key consumers India and China cut back purchases.
Leading vegetable oil analysts and industry officials have warned that India, the world's biggest edible oil consumer, would likely reduce palm imports this year to buy more rival soyoil, as palm's discount continues to narrow.
A U.S. Department of Agriculture attache early Thursday forecast Malaysia's palm oil output to moderately rise to 20.35 million tonnes in 2014/15 due to a small increase in yields and plantation areas. Exports are projected to grow only marginally.
Benchmark Malaysian palm prices, which set the tone for global palm market, have lost more than 5 percent so far in March - their biggest drop since Feb. 2013. They are on course for their third straight weekly loss.
In other markets, Brent crude oil held steady around $107 a barrel on Thursday, underpinned by worries about potential supply disruption due to the possibility of Western sanctions on Russia's energy sector.
In other competing vegetable oil markets, the U.S. soyoil contract for May rose 0.1 percent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange gained 0.6 percent.
Palm, soy and crude oil prices at 1021 GMT
Contract Month Last Change Low High Volume
MY PALM OIL APR4 2744 -26.00 2736 2761 125
MY PALM OIL MAY4 2670 -39.00 2670 2716 5587
MY PALM OIL JUN4 2656 -35.00 2652 2695 23130
CHINA PALMOLEIN SEP4 6224 +28.00 6140 6256 575408
CHINA SOYOIL SEP4 6950 +40.00 6878 6974 635120
CBOT SOY OIL MAY4 40.77 +0.04 40.64 41.10 8532
NYMEX CRUDE MAY4 100.31 +0.05 100.03 100.41 13018
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 = 3.29 Malaysian ringgit)
($1 = 6.213 Chinese yuan)