MARKET DEVELOPMENT
VEGOILS-Palm Down for 2nd Day as Crude Slumps, Exports Disappoint
VEGOILS-Palm Down for 2nd Day as Crude Slumps, Exports Disappoint
(Updates prices)
* Malaysia's Oct 1-10 palm oil exports down 18.9 pct m/m -ITS
* Brent slumps below $90 to near 4-year low
* Palm oil to test support at 2,142 ringgit -technicals
* Malaysia's end-Sept palm stocks up 1.8 pct m/m -MPOB
11/10/2014 (Reuters) - Malaysian palm oil futures slipped to a one-week low on Friday, shaving off some gains made earlier this week as tumbling crude prices and disappointing export data stoked fears of weaker appetite for palm.
Brent crude futures fell below $90 a barrel on Friday, close to a four-year low, as rising supply and more grim economic news stretched a months-long slump in oil prices.
Weaker crude prices make palm oil a less attractive blending option for biodiesel feedstock.
A surprise fall in October export data after September's strong performance also weighed on prices, traders said. Exports of Malaysian palm oil products between Oct. 1-10 fell 18.9 percent to 395,532 tonnes as demand to India nearly halved.
"Palm oil is under pressure on the back of crude oil prices, and our exports are also not good," said a trader with a foreign commodities brokerage in Kuala Lumpur.
The benchmark December contract on the Bursa Malaysia Derivatives Exchange had edged down 0.5 percent to 2,181 ringgit ($670) per tonne by the day's close. Prices earlier fell to 2,158 ringgit, their lowest since Oct. 3.
Total traded volume stood at 48,456 lots of 25 tonnes each, above the usual 35,000 lots.
Palm prices are up only 0.6 percent this week, after slumping crude prices and a rally in the Malaysian ringgit shaved off some gains.
The trader added that industry players were anticipating Malaysian palm oil end-stocks to remain lofty above the 2 million tonne psychological level.
"MPOB (data) won't be anything fantastic. The end-stocks should be high, which reflects why the market is at this level," the trader added, referring to industry regulator, the Malaysian Palm Oil Board.
Data from MPOB, released after the midday break, showed end-stocks in the No.2 producer rose 1.8 percent to an 18-month high of 2.09 million tonnes.
With palm prices having only recently recovered from five-year lows and the world's top two producing countries cutting export tariffs in efforts to boost sales in recent months, Malaysia announced on Friday it would extend an export duty exemption on crude palm oil until December.
Technicals showed palm oil is expected to test support at 2,142 ringgit per tonne, as a correction from the Oct. 1 high of 2,223 ringgit has not completed, said Reuters market analyst Wang Tao.
The Malaysian weather office expects rains and afternoon thunderstorms over most of the country in October, before the wetter northeast monsoon season kicks in.
Output typically drops in the fourth quarter of the year during the wet season as prolonged rains and floods delay harvesting and complicate transportation of palm fruit.
Some weather experts, however, say the drought-inducing El Nino weather phenomenon may unravel in the last quarter of the year.
The U.S. Climate Prediction Center said on Thursday a weak El Nino is favoured to occur in 1-2 months, while Japan's weather bureau reiterated it sees a 50 percent chance of the weather pattern forming during the autumn and winter months.
Traders said if El Nino heats up Malaysia in the beginning of next year, the spell of dry weather seen at the start of 2013 might return and worsen.
"If weather conditions really turn bad, then after this depressing run, from January onwards palm oil prices will go up, and maybe the 3,000 ringgit that had failed to be achieved this year might be seen next year," the Kuala Lumpur-based trader added.
In other competing vegetable oil markets, the U.S. soyoil contract for December fell 0.64 percent in late Asian trade, while the most active January soybean oil contract on the Dalian Commodities Exchange shed 0.61 percent.
Palm, soy and crude oil prices at 1008 GMT
Contract Month Last Change Low High Volume
MY PALM OIL OCT4 0 +0.00 0 0 0
MY PALM OIL NOV4 2193 -14.00 2176 2211 3915
MY PALM OIL DEC4 2181 -10.00 2158 2198 25394
CHINA PALM OLEIN JAN5 5230 -10.00 5194 5264 809672
CHINA SOYOIL JAN5 5910 -36.00 5876 5952 459666
CBOT SOY OIL DEC4 32.80 -4.40 32.61 33.06 7884
INDIA PALM OIL OCT4 451.00 -4.40 447.70 452.90 1245
INDIA SOYOIL OCT4 601.00 -3.75 598.60 603.50 23165
NYMEX CRUDE NOV4 84.56 -1.21 83.59 85.00 48147
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
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel
($1 = 3.25 Malaysian ringgit)
($1 = 6.1321 Chinese yuan)
($1 = 61.16 Indian rupees)
* Malaysia's Oct 1-10 palm oil exports down 18.9 pct m/m -ITS
* Brent slumps below $90 to near 4-year low
* Palm oil to test support at 2,142 ringgit -technicals
* Malaysia's end-Sept palm stocks up 1.8 pct m/m -MPOB
11/10/2014 (Reuters) - Malaysian palm oil futures slipped to a one-week low on Friday, shaving off some gains made earlier this week as tumbling crude prices and disappointing export data stoked fears of weaker appetite for palm.
Brent crude futures fell below $90 a barrel on Friday, close to a four-year low, as rising supply and more grim economic news stretched a months-long slump in oil prices.
Weaker crude prices make palm oil a less attractive blending option for biodiesel feedstock.
A surprise fall in October export data after September's strong performance also weighed on prices, traders said. Exports of Malaysian palm oil products between Oct. 1-10 fell 18.9 percent to 395,532 tonnes as demand to India nearly halved.
"Palm oil is under pressure on the back of crude oil prices, and our exports are also not good," said a trader with a foreign commodities brokerage in Kuala Lumpur.
The benchmark December contract on the Bursa Malaysia Derivatives Exchange had edged down 0.5 percent to 2,181 ringgit ($670) per tonne by the day's close. Prices earlier fell to 2,158 ringgit, their lowest since Oct. 3.
Total traded volume stood at 48,456 lots of 25 tonnes each, above the usual 35,000 lots.
Palm prices are up only 0.6 percent this week, after slumping crude prices and a rally in the Malaysian ringgit shaved off some gains.
The trader added that industry players were anticipating Malaysian palm oil end-stocks to remain lofty above the 2 million tonne psychological level.
"MPOB (data) won't be anything fantastic. The end-stocks should be high, which reflects why the market is at this level," the trader added, referring to industry regulator, the Malaysian Palm Oil Board.
Data from MPOB, released after the midday break, showed end-stocks in the No.2 producer rose 1.8 percent to an 18-month high of 2.09 million tonnes.
With palm prices having only recently recovered from five-year lows and the world's top two producing countries cutting export tariffs in efforts to boost sales in recent months, Malaysia announced on Friday it would extend an export duty exemption on crude palm oil until December.
Technicals showed palm oil is expected to test support at 2,142 ringgit per tonne, as a correction from the Oct. 1 high of 2,223 ringgit has not completed, said Reuters market analyst Wang Tao.
The Malaysian weather office expects rains and afternoon thunderstorms over most of the country in October, before the wetter northeast monsoon season kicks in.
Output typically drops in the fourth quarter of the year during the wet season as prolonged rains and floods delay harvesting and complicate transportation of palm fruit.
Some weather experts, however, say the drought-inducing El Nino weather phenomenon may unravel in the last quarter of the year.
The U.S. Climate Prediction Center said on Thursday a weak El Nino is favoured to occur in 1-2 months, while Japan's weather bureau reiterated it sees a 50 percent chance of the weather pattern forming during the autumn and winter months.
Traders said if El Nino heats up Malaysia in the beginning of next year, the spell of dry weather seen at the start of 2013 might return and worsen.
"If weather conditions really turn bad, then after this depressing run, from January onwards palm oil prices will go up, and maybe the 3,000 ringgit that had failed to be achieved this year might be seen next year," the Kuala Lumpur-based trader added.
In other competing vegetable oil markets, the U.S. soyoil contract for December fell 0.64 percent in late Asian trade, while the most active January soybean oil contract on the Dalian Commodities Exchange shed 0.61 percent.
Palm, soy and crude oil prices at 1008 GMT
Contract Month Last Change Low High Volume
MY PALM OIL OCT4 0 +0.00 0 0 0
MY PALM OIL NOV4 2193 -14.00 2176 2211 3915
MY PALM OIL DEC4 2181 -10.00 2158 2198 25394
CHINA PALM OLEIN JAN5 5230 -10.00 5194 5264 809672
CHINA SOYOIL JAN5 5910 -36.00 5876 5952 459666
CBOT SOY OIL DEC4 32.80 -4.40 32.61 33.06 7884
INDIA PALM OIL OCT4 451.00 -4.40 447.70 452.90 1245
INDIA SOYOIL OCT4 601.00 -3.75 598.60 603.50 23165
NYMEX CRUDE NOV4 84.56 -1.21 83.59 85.00 48147
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
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel
($1 = 3.25 Malaysian ringgit)
($1 = 6.1321 Chinese yuan)
($1 = 61.16 Indian rupees)