MARKET DEVELOPMENT
VEGOILS-Palm Up as Soy Markets Support, But Falls for 2nd Straight Week
VEGOILS-Palm Up as Soy Markets Support, But Falls for 2nd Straight Week
10/05/2014 (Reuters) - Malaysian palm oil futures ended higher on Friday, following gains in overseas soyoil markets, although a stronger ringgit and investor wariness ahead of industry data capped the advance and kept prices in a tight range.
Palm prices lost 0.6 percent this week, their second straight weekly fall after sliding to over three-month lows as volatility in comparative soy markets and a stronger ringgit dragged.
"The Dalian and U.S. soybean oil (markets) were marginally higher. Although the ringgit is strong, the palm market pulled up a bit," said a trader with a foreign commodities brokerage.
"Prices are contained in a tight range, volume is light today. They (investors) want to see the MPOB data next week," the Malaysia-based trader added.
The benchmark July contract on the Bursa Malaysia Derivatives Exchange ended 0.5 percent higher at 2,576 ringgit ($798) per tonne on Friday. Prices traded in a range between 2,552 and 2,593 ringgit.
Total traded volume stood at 31,962 lots of 25 tonnes, below the average 35,000 lots as some investors stayed on the sidelines.
Technicals showed a bearish target at 2,519 ringgit per tonne remains unchanged for palm oil, as it could have completed a consolidation around a support at 2,572 ringgit, said Reuters market analyst Wang Tao.
Market players have also avoided risky bets this week ahead of an industry report from the Malaysian Palm Oil Board next Monday, that will detail April palm oil stocks, output and exports in the second-largest grower.
A Reuters poll on Thursday showed that Malaysian palm oil stocks likely inched up to a three-month high of 1.70 million tonnes in April, with production volumes seen at their highest since December last year.
A slight pick-up in exports, however, could have checked the rise in stockpiles, the poll of six traders and planters showed.
The Malaysian ringgit gained as much as 0.5 percent on Friday to trade at 3.2200 per U.S. dollar, its strongest since April 10, after Bank Negara Malaysia signalled the central bank may need to tighten monetary policy soon.
A stronger ringgit makes palm feedstock, which is ringgit-denominated, more expensive for overseas investors and refiners.
In competing vegetable oil markets, the U.S. soyoil contract for July rose 0.7 percent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange rose 0.6 percent.
In other markets, Brent crude rose above $108 per barrel on Friday, supported by tension in Ukraine and limited supply from Libya, where a recent deal to reopen oil export terminals seemed unlikely to go ahead.
Palm, soy and crude oil prices at 1010 GMT
Contract Month Last Change Low High Volume
MY PALM OIL MAY4 2630 -3.00 2630 2645 255
MY PALM OIL JUN4 2603 +11.00 2583 2618 1674
MY PALM OIL JUL4 2576 +12.00 2552 2593 17849
CHINA PALM OLEIN SEP4 5988 +18.00 5958 5998 207232
CHINA SOYOIL SEP4 6824 +40.00 6784 6832 290098
CBOT SOY OIL JUL4 41.40 +0.28 41.03 41.44 4555
NYMEX CRUDE JUN4 101.07 +0.81 100.23 101.18 22124
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 = 3.227 Malaysian ringgit)
($1 = 6.2280 Chinese yuan)
Palm prices lost 0.6 percent this week, their second straight weekly fall after sliding to over three-month lows as volatility in comparative soy markets and a stronger ringgit dragged.
"The Dalian and U.S. soybean oil (markets) were marginally higher. Although the ringgit is strong, the palm market pulled up a bit," said a trader with a foreign commodities brokerage.
"Prices are contained in a tight range, volume is light today. They (investors) want to see the MPOB data next week," the Malaysia-based trader added.
The benchmark July contract on the Bursa Malaysia Derivatives Exchange ended 0.5 percent higher at 2,576 ringgit ($798) per tonne on Friday. Prices traded in a range between 2,552 and 2,593 ringgit.
Total traded volume stood at 31,962 lots of 25 tonnes, below the average 35,000 lots as some investors stayed on the sidelines.
Technicals showed a bearish target at 2,519 ringgit per tonne remains unchanged for palm oil, as it could have completed a consolidation around a support at 2,572 ringgit, said Reuters market analyst Wang Tao.
Market players have also avoided risky bets this week ahead of an industry report from the Malaysian Palm Oil Board next Monday, that will detail April palm oil stocks, output and exports in the second-largest grower.
A Reuters poll on Thursday showed that Malaysian palm oil stocks likely inched up to a three-month high of 1.70 million tonnes in April, with production volumes seen at their highest since December last year.
A slight pick-up in exports, however, could have checked the rise in stockpiles, the poll of six traders and planters showed.
The Malaysian ringgit gained as much as 0.5 percent on Friday to trade at 3.2200 per U.S. dollar, its strongest since April 10, after Bank Negara Malaysia signalled the central bank may need to tighten monetary policy soon.
A stronger ringgit makes palm feedstock, which is ringgit-denominated, more expensive for overseas investors and refiners.
In competing vegetable oil markets, the U.S. soyoil contract for July rose 0.7 percent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange rose 0.6 percent.
In other markets, Brent crude rose above $108 per barrel on Friday, supported by tension in Ukraine and limited supply from Libya, where a recent deal to reopen oil export terminals seemed unlikely to go ahead.
Palm, soy and crude oil prices at 1010 GMT
Contract Month Last Change Low High Volume
MY PALM OIL MAY4 2630 -3.00 2630 2645 255
MY PALM OIL JUN4 2603 +11.00 2583 2618 1674
MY PALM OIL JUL4 2576 +12.00 2552 2593 17849
CHINA PALM OLEIN SEP4 5988 +18.00 5958 5998 207232
CHINA SOYOIL SEP4 6824 +40.00 6784 6832 290098
CBOT SOY OIL JUL4 41.40 +0.28 41.03 41.44 4555
NYMEX CRUDE JUN4 101.07 +0.81 100.23 101.18 22124
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 = 3.227 Malaysian ringgit)
($1 = 6.2280 Chinese yuan)