MARKET DEVELOPMENT
VEGOILS-Palm Hits New Lows as Fundamentals Pull Prices Further
VEGOILS-Palm Hits New Lows as Fundamentals Pull Prices Further
* Weak crude and soybean prices push palm to lowest since Oct 2009
* Palm prices need to close above 2,100 to signal reversal - trader
* Target at 2,046 ringgit per tonne resumed -technicals (Recasts, changes throughout)
20/08/2014 (Reuters) - Malaysian palm oil prices sank to their lowest levels in almost five years on Tuesday as declining crude and soybean oil prices pushed them down.
By Tuesday's close, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had shed 1.05 percent to 2,066 ringgit ($655) per tonne, its lowest since October 2009. Total traded volume stood at 40,824 lots of 25 tonnes, above the daily traded average of 35,000 lots.
"The market is down and there was no impetus to move higher," said a trader with a foreign commodities brokerage in Kuala Lumpur, "although it is a little oversold."
Weak crude, soybean and soybean oil prices had helped push palm prices to new lows after a lull in trading earlier in the day, he said.
Palm typically tracks soyoil, a rival edible oil and common food and fuel substitute. Soy markets are facing pressure over forecasts of a bountiful soybean crop from the United States, a top exporter.
Palm oil prices failed to breach the 2,100 ringgit per tonne level during the day, which could have signalled that a bottom price had been reached, he said. "Then we'd see a proper retracement coming (and) whatever bearish elements (would) have already been factored into prices," he said.
Technicals showed a bearish target at 2,046 ringgit had resumed after palm pierced its Aug. 18 low of 2,083 ringgit, said Reuters market analyst Wang Tao.
In other markets, Brent crude oil prices on Tuesday were close to the 14-month lows reached the previous day as weak demand and improving supplies weighed on the market, although global political risk still provided some support.
In competing vegetable oil markets, the U.S. soyoil contract for December lost 0.72 percent in early Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange gained 0.1 percent. Palm, soy and crude oil prices at 1038 GMT Contract Month Last Change Low High Volume MY PALM OIL SEP4 2074 -25.00 2074 2107 863 MY PALM OIL OCT4 2065 -22.00 2063 2097 12338 MY PALM OIL NOV4 2066 -20.00 2066 2098 15286 CHINA PALM OLEIN JAN5 5306 -6.00 5288 5314 299832 CHINA SOYOIL JAN5 5998 +6.00 5990 6030 288148 CBOT SOY OIL DEC4 33.13 -0.20 33.08 33.45 5802 NYMEX CRUDE SEP4 96.75 +0.34 96.54 97.05 4766 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 US dollar = 3.1560 Malaysian ringgit) (1 US dollar = 6.1408 Chinese yuan)
* Palm prices need to close above 2,100 to signal reversal - trader
* Target at 2,046 ringgit per tonne resumed -technicals (Recasts, changes throughout)
20/08/2014 (Reuters) - Malaysian palm oil prices sank to their lowest levels in almost five years on Tuesday as declining crude and soybean oil prices pushed them down.
By Tuesday's close, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had shed 1.05 percent to 2,066 ringgit ($655) per tonne, its lowest since October 2009. Total traded volume stood at 40,824 lots of 25 tonnes, above the daily traded average of 35,000 lots.
"The market is down and there was no impetus to move higher," said a trader with a foreign commodities brokerage in Kuala Lumpur, "although it is a little oversold."
Weak crude, soybean and soybean oil prices had helped push palm prices to new lows after a lull in trading earlier in the day, he said.
Palm typically tracks soyoil, a rival edible oil and common food and fuel substitute. Soy markets are facing pressure over forecasts of a bountiful soybean crop from the United States, a top exporter.
Palm oil prices failed to breach the 2,100 ringgit per tonne level during the day, which could have signalled that a bottom price had been reached, he said. "Then we'd see a proper retracement coming (and) whatever bearish elements (would) have already been factored into prices," he said.
Technicals showed a bearish target at 2,046 ringgit had resumed after palm pierced its Aug. 18 low of 2,083 ringgit, said Reuters market analyst Wang Tao.
In other markets, Brent crude oil prices on Tuesday were close to the 14-month lows reached the previous day as weak demand and improving supplies weighed on the market, although global political risk still provided some support.
In competing vegetable oil markets, the U.S. soyoil contract for December lost 0.72 percent in early Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange gained 0.1 percent. Palm, soy and crude oil prices at 1038 GMT Contract Month Last Change Low High Volume MY PALM OIL SEP4 2074 -25.00 2074 2107 863 MY PALM OIL OCT4 2065 -22.00 2063 2097 12338 MY PALM OIL NOV4 2066 -20.00 2066 2098 15286 CHINA PALM OLEIN JAN5 5306 -6.00 5288 5314 299832 CHINA SOYOIL JAN5 5998 +6.00 5990 6030 288148 CBOT SOY OIL DEC4 33.13 -0.20 33.08 33.45 5802 NYMEX CRUDE SEP4 96.75 +0.34 96.54 97.05 4766 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 US dollar = 3.1560 Malaysian ringgit) (1 US dollar = 6.1408 Chinese yuan)