MARKET DEVELOPMENT
VEGOILS-Palm Hits Over Three-month High as Soy Jumps; Price Recovery Eyed
VEGOILS-Palm Hits Over Three-month High as Soy Jumps; Price Recovery Eyed
(Updates prices, adds graf on Indonesian CPO export tax decision)
* Dalian soyoil climbs to 1-1/2 month high
* Palm oil to rise to 2,340 ringgit -technicals
* Leading analysts turn friendly on palm prices on weaker output, rising consumption
* Indonesia keeps Nov. CPO export tax at zero pct
31/10/2014 (Reuters) - Malaysian palm oil futures rose to a more than three-month high on Thursday, driven by big gains in comparative soy markets as well as optimism that growing food consumption amid weakening palm output will underpin prices into next year.
The most active January soybean oil contract on the Dalian Commodities Exchange surged to a 1-1/2 month high and was up 2.6 percent in late Asian trade, while the U.S. soyoil contract for December was little changed after overnight gains.
U.S. soybeans rose to a seven-week peak and were trading around $10.45-3/4 a bushel late Thursday, buoyed by a slow start to its anticipated record soybean harvest.
"The market is pretty strong. Soybeans and soybean oil rallied sharply, the whole grain complex is up, and palm isreflecting this," said a trader with a foreign commodities brokerage in Kuala Lumpur.
"Everything is bottoming out, and there's strong demand coming in."
The benchmark January contract on the Bursa Malaysia Derivatives Exchange had edged up 0.8 percent to 2,280 ringgit ($693) per tonne by the day's close. Prices peaked at 2,302 ringgit in intraday trade, their highest since July 21.
Total traded volume stood at 65,212 lots of 25 tonnes, nearly double the usual 35,000 lots.
Technicals looked bullish. Malaysian palm oil is expected to rise to 2,340 ringgit per tonne, as it has cleared resistance at 2,295 ringgit, said Reuters market analyst Wang Tao.
Leading industry analysts are now more bullish on prices of palm, the world's most traded vegetable oil, due to seasonally weakening output caused by dry spells earlier in Malaysia, as well as the ongoing drought in the palm-growing region of Indonesia's Kalimantan.
Both Indonesia and Malaysia account for about 85 percent of the world's palm oil supply.
Indonesia will set its crude palm oil export tax for November at zero, unchanged from a month ago, a government official said on Thursday. The decision was largely anticipated by industry sources, who expected the top producer to strive to remain competitive with rival Malaysia.
Prices would likely also draw support from rising demand in India and China, the world's biggest edible oil buyers, the analysts said.
Top vegetable oil analyst Dorab Mistry told a palm oil conference in Kuala Lumpur on Wednesday that prices will likely trade between 2,100-2,300 ringgit over the next few weeks before rising to around 2,500 ringgit by March, as output drops and stocks ease.
Thomas Mielke, editor of Hamburg-based newsletter Oil World, forecast palm futures to rise to between 2,300 ringgit and 2,500 ringgit in the first quarter of 2015, buoyed by bigger demand from the food segment and rising population growth.
Chairman of London-based commodities consultancy LMC International, James Fry, however expects prices to be capped at 2,300 ringgit if Brent prices fall to $85 a barrel.
Brent crude oil fell below $87 a barrel on Thursday, pressured by a stronger dollar after the U.S. Federal Reserve painted a brighter outlook for the U.S. economy.
"Most of the experts believe that crude palm oil prices should recover as demand from the food segment is likely to exceed production affected by the dry season in 2014/2015 season," said Kenanga Investment Bank analyst Alan Lim.
Lim kept his forecast for crude palm oil prices to average at 2,500 ringgit in 2014, and expects stockpiles to shrink to as low as 1.5 million tonnes by end-2015.
Palm, soy and crude oil prices at 1029 GMT
Contract Month Last Change Low High Volume
MY PALM OIL NOV4 2280 +20.00 2268 2290 163
MY PALM OIL DEC4 2286 +17.00 2278 2309 6157
MY PALM OIL JAN5 2280 +17.00 2270 2302 29818
CHINA PALM OLEIN JAN5 5362 +150.00 5296 5402 1218258
CHINA SOYOIL JAN5 5978 +154.00 5942 6034 774104
CBOT SOY OIL DEC4 34.17 +3.20 33.91 34.59 12978
INDIA PALM OIL OCT4 455.90 +3.20 451.70 456.90 323
NYMEX CRUDE DEC4 81.58 -0.62 81.21 82.09 24056
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 US dollar = 3.288 Malaysian ringgit)
(1 US dollar = 6.1159 Chinese yuan)
(1 US dollar = 61.44 Indian rupee)
* Dalian soyoil climbs to 1-1/2 month high
* Palm oil to rise to 2,340 ringgit -technicals
* Leading analysts turn friendly on palm prices on weaker output, rising consumption
* Indonesia keeps Nov. CPO export tax at zero pct
31/10/2014 (Reuters) - Malaysian palm oil futures rose to a more than three-month high on Thursday, driven by big gains in comparative soy markets as well as optimism that growing food consumption amid weakening palm output will underpin prices into next year.
The most active January soybean oil contract on the Dalian Commodities Exchange surged to a 1-1/2 month high and was up 2.6 percent in late Asian trade, while the U.S. soyoil contract for December was little changed after overnight gains.
U.S. soybeans rose to a seven-week peak and were trading around $10.45-3/4 a bushel late Thursday, buoyed by a slow start to its anticipated record soybean harvest.
"The market is pretty strong. Soybeans and soybean oil rallied sharply, the whole grain complex is up, and palm isreflecting this," said a trader with a foreign commodities brokerage in Kuala Lumpur.
"Everything is bottoming out, and there's strong demand coming in."
The benchmark January contract on the Bursa Malaysia Derivatives Exchange had edged up 0.8 percent to 2,280 ringgit ($693) per tonne by the day's close. Prices peaked at 2,302 ringgit in intraday trade, their highest since July 21.
Total traded volume stood at 65,212 lots of 25 tonnes, nearly double the usual 35,000 lots.
Technicals looked bullish. Malaysian palm oil is expected to rise to 2,340 ringgit per tonne, as it has cleared resistance at 2,295 ringgit, said Reuters market analyst Wang Tao.
Leading industry analysts are now more bullish on prices of palm, the world's most traded vegetable oil, due to seasonally weakening output caused by dry spells earlier in Malaysia, as well as the ongoing drought in the palm-growing region of Indonesia's Kalimantan.
Both Indonesia and Malaysia account for about 85 percent of the world's palm oil supply.
Indonesia will set its crude palm oil export tax for November at zero, unchanged from a month ago, a government official said on Thursday. The decision was largely anticipated by industry sources, who expected the top producer to strive to remain competitive with rival Malaysia.
Prices would likely also draw support from rising demand in India and China, the world's biggest edible oil buyers, the analysts said.
Top vegetable oil analyst Dorab Mistry told a palm oil conference in Kuala Lumpur on Wednesday that prices will likely trade between 2,100-2,300 ringgit over the next few weeks before rising to around 2,500 ringgit by March, as output drops and stocks ease.
Thomas Mielke, editor of Hamburg-based newsletter Oil World, forecast palm futures to rise to between 2,300 ringgit and 2,500 ringgit in the first quarter of 2015, buoyed by bigger demand from the food segment and rising population growth.
Chairman of London-based commodities consultancy LMC International, James Fry, however expects prices to be capped at 2,300 ringgit if Brent prices fall to $85 a barrel.
Brent crude oil fell below $87 a barrel on Thursday, pressured by a stronger dollar after the U.S. Federal Reserve painted a brighter outlook for the U.S. economy.
"Most of the experts believe that crude palm oil prices should recover as demand from the food segment is likely to exceed production affected by the dry season in 2014/2015 season," said Kenanga Investment Bank analyst Alan Lim.
Lim kept his forecast for crude palm oil prices to average at 2,500 ringgit in 2014, and expects stockpiles to shrink to as low as 1.5 million tonnes by end-2015.
Palm, soy and crude oil prices at 1029 GMT
Contract Month Last Change Low High Volume
MY PALM OIL NOV4 2280 +20.00 2268 2290 163
MY PALM OIL DEC4 2286 +17.00 2278 2309 6157
MY PALM OIL JAN5 2280 +17.00 2270 2302 29818
CHINA PALM OLEIN JAN5 5362 +150.00 5296 5402 1218258
CHINA SOYOIL JAN5 5978 +154.00 5942 6034 774104
CBOT SOY OIL DEC4 34.17 +3.20 33.91 34.59 12978
INDIA PALM OIL OCT4 455.90 +3.20 451.70 456.90 323
NYMEX CRUDE DEC4 81.58 -0.62 81.21 82.09 24056
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 US dollar = 3.288 Malaysian ringgit)
(1 US dollar = 6.1159 Chinese yuan)
(1 US dollar = 61.44 Indian rupee)