MARKET DEVELOPMENT
VEGOILS-Palm Oil Falls as Crude Slides to Four-year Lows
VEGOILS-Palm Oil Falls as Crude Slides to Four-year Lows
(Updates prices, adds trader quotes)
* Oil falls $2 to 4-year low on doubts over cut in OPEC output
* Rumours of CPO cargo defaults in India unsettle investors -trader
* U.S. soy markets closed for Thanksgiving holiday
* Palm oil may revisit low of 2,187 ringgit- technicals
28/11/2014 (Reuters) - Malaysian palm oil futures fell on Thursday as crude oil prices plunged to their lowest in four years, stoking worries that the tropical oil may lose its appeal as an additive in biofuels, while rumours of palm cargo defaults in India spooked investors.
Brent crude fell $2 to a 50-month low under $76 a barrel, while U.S. crude lost more than $1 to a session low of $71.89, as oil producers in OPEC looked set to keep output unchanged despite a huge oversupply in world markets.
"Market sentiment is likely weighed by crude oil movements today ahead of the OPEC meeting, and in the absence of Globex soy oil trading," said a trader with a local commodities brokerage in Malaysia.
The trader added that rumours about Indian buyers defaulting 30,000-60,000 tonnes of crude palm oil cargoes also aided the speculative sell-off in palm oil.
The benchmark February contract on the Bursa Malaysia Derivatives Exchange had inched down 1.7 percent to 2,201 ringgit ($657) per tonne by Thursday's close.
Total traded volume stood at just 21,950 lots of 25 tonnes, below the usual 35,000 lots.
Some commodity fund managers say oil prices could slide to $60 per barrel if OPEC does not agree to a significant output cut of at least 1 million barrels per day at its meet. Such a fall would dent palm oil's demand for discretionary biodiesel blending and spell trouble for biofuel mandate targets in top growers Indonesia and Malaysia.
Investors were also looking to a palm oil industry meet in Indonesia on Thursday and Friday for signals on where palm prices could head into in 2015.
A second Malaysia-based trader said concerns over better-than-expected output this month pushing up stockpiles, alongside sluggish bookings for December shipments, have prompted some investors to unwind long positions in the futures market.
In other competing vegetable oil markets, the most active May soybean oil contract on the Dalian Commodities Exchange edged up 0.1 percent in late Asian trade. U.S. soy markets are closed for the Thanksgiving holiday.
Palm, soy and crude oil prices at 1014 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC4 2164 -41.00 2162 2212 516
MY PALM OIL JAN5 2198 -41.00 2195 2235 1106
MY PALM OIL FEB5 2201 -39.00 2199 2236 13108
CHINA PALM OLEIN MAY5 5334 +6.00 5278 5338 694232
CHINA SOYOIL MAY5 5908 +4.00 5856 5910 327092
CBOT SOY OIL JAN5 33.66 -2.40 0.00 0.00 0
INDIA PALM OIL NOV4 440.60 -2.40 440.60 442.60 152
INDIA SOYOIL DEC4 585.70 -8.70 584.30 594.20 48900
NYMEX CRUDE JAN5 72.24 -1.45 71.89 73.56 35744
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 = 3.35 Malaysian ringgit)
($1 = 6.1392 Chinese yuan)
($1 = 61.87 Indian rupee)
* Oil falls $2 to 4-year low on doubts over cut in OPEC output
* Rumours of CPO cargo defaults in India unsettle investors -trader
* U.S. soy markets closed for Thanksgiving holiday
* Palm oil may revisit low of 2,187 ringgit- technicals
28/11/2014 (Reuters) - Malaysian palm oil futures fell on Thursday as crude oil prices plunged to their lowest in four years, stoking worries that the tropical oil may lose its appeal as an additive in biofuels, while rumours of palm cargo defaults in India spooked investors.
Brent crude fell $2 to a 50-month low under $76 a barrel, while U.S. crude lost more than $1 to a session low of $71.89, as oil producers in OPEC looked set to keep output unchanged despite a huge oversupply in world markets.
"Market sentiment is likely weighed by crude oil movements today ahead of the OPEC meeting, and in the absence of Globex soy oil trading," said a trader with a local commodities brokerage in Malaysia.
The trader added that rumours about Indian buyers defaulting 30,000-60,000 tonnes of crude palm oil cargoes also aided the speculative sell-off in palm oil.
The benchmark February contract on the Bursa Malaysia Derivatives Exchange had inched down 1.7 percent to 2,201 ringgit ($657) per tonne by Thursday's close.
Total traded volume stood at just 21,950 lots of 25 tonnes, below the usual 35,000 lots.
Some commodity fund managers say oil prices could slide to $60 per barrel if OPEC does not agree to a significant output cut of at least 1 million barrels per day at its meet. Such a fall would dent palm oil's demand for discretionary biodiesel blending and spell trouble for biofuel mandate targets in top growers Indonesia and Malaysia.
Investors were also looking to a palm oil industry meet in Indonesia on Thursday and Friday for signals on where palm prices could head into in 2015.
A second Malaysia-based trader said concerns over better-than-expected output this month pushing up stockpiles, alongside sluggish bookings for December shipments, have prompted some investors to unwind long positions in the futures market.
In other competing vegetable oil markets, the most active May soybean oil contract on the Dalian Commodities Exchange edged up 0.1 percent in late Asian trade. U.S. soy markets are closed for the Thanksgiving holiday.
Palm, soy and crude oil prices at 1014 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC4 2164 -41.00 2162 2212 516
MY PALM OIL JAN5 2198 -41.00 2195 2235 1106
MY PALM OIL FEB5 2201 -39.00 2199 2236 13108
CHINA PALM OLEIN MAY5 5334 +6.00 5278 5338 694232
CHINA SOYOIL MAY5 5908 +4.00 5856 5910 327092
CBOT SOY OIL JAN5 33.66 -2.40 0.00 0.00 0
INDIA PALM OIL NOV4 440.60 -2.40 440.60 442.60 152
INDIA SOYOIL DEC4 585.70 -8.70 584.30 594.20 48900
NYMEX CRUDE JAN5 72.24 -1.45 71.89 73.56 35744
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 = 3.35 Malaysian ringgit)
($1 = 6.1392 Chinese yuan)
($1 = 61.87 Indian rupee)