MARKET DEVELOPMENT
VEGOILS-Palm Pressured By Weak Crude, Market Watching Monsoon Impact
VEGOILS-Palm Pressured By Weak Crude, Market Watching Monsoon Impact
(Updates with closing prices)
* Monsoon rains could curb December production - traders
* Brent falls below $63 to lowest in more than 5 yrs
13/12/2014 (Reuters) - Malaysian palm oil futures dropped on Friday, tracking falls in crude oil prices andcompeting vegetable oil markets, although losses were limited by concerns that monsoon rains could curb output in December.
The benchmark February contract on the Bursa Malaysia Derivatives Exchange closed 1.1 percent lower at 2,171 ringgit ($621) per tonne. Prices had fallen to a one-week low of2,119 ringgit on Tuesday.
Total traded volume stood at 46,017 lots of 25 tonnes, above the daily average of 35,000 lots.
Brent crude futures fell to its lowest level in more than five years below $63 a barrel, under pressure from a glut of oil in the market. Low crude prices raised concern that buyers could shift fuel demand away from palm.
Also, market participants expect December monsoon rains and flooding to significantly curb yields of palm fruit and reduce oil extraction rates.
"Demand is expected to garner momentum in the first quarter next year. Prices will eventually trade circa 2300-2400 ringgit by that period," said Lingam Supramaniam, director at Malaysia-based commodities firm Pelindung Bestari.
In a note to clients, analysts at CIMB said they expected palm oil stocks to fall by 2 percent month-on-month by the end of December to 2.2 million tonnes due to lower production.
"We expect palm oil production to decline by 9 percent month-on-month to 1.6 million tonnes in December 2014 due to seasonal factors," CIMB said.
In competing vegetable oil markets, the U.S. soyoil contract for January edged down 0.3 percent in late Asian trade, while the most active May soybean oil contract on the Dalian Commodity Exchange fell 0.5 percent.
U.S. soybean futures were 0.4 percent lower but were still on track for their second consecutive weekly gain.
India's palm oil imports fell 8 percent to 796,587 tonnes in November from a month earlier, data from the Solvent Extractors' Association of India (SEA) showed.
Palm, soy and crude oil prices at 1001 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC4 2168 -7.00 2145 2190 277
MY PALM OIL JAN5 2158 -22.00 2150 2199 1103
MY PALM OIL FEB5 2171 -24.00 2165 2216 22501
CHINA PALM OLEIN MAY5 5010 -20.00 5002 5054 841794
CHINA SOYOIL MAY5 5662 -28.00 5660 5728 350794
CBOT SOY OIL JAN5 31.93 -4.20 31.91 32.15 31177
INDIA PALM OIL DEC4 419.80 -4.20 417.90 424.70 952
INDIA SOYOIL DEC4 579.00 -1.55 578.70 581.00 6775
NYMEX CRUDE JAN5 59.28 -0.68 58.80 59.52 33882
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= 3.4940 Malaysian ringgit)
($1= 6.1901 Chinese yuan)
($1= 62.4850 Indian rupee)
* Monsoon rains could curb December production - traders
* Brent falls below $63 to lowest in more than 5 yrs
13/12/2014 (Reuters) - Malaysian palm oil futures dropped on Friday, tracking falls in crude oil prices andcompeting vegetable oil markets, although losses were limited by concerns that monsoon rains could curb output in December.
The benchmark February contract on the Bursa Malaysia Derivatives Exchange closed 1.1 percent lower at 2,171 ringgit ($621) per tonne. Prices had fallen to a one-week low of2,119 ringgit on Tuesday.
Total traded volume stood at 46,017 lots of 25 tonnes, above the daily average of 35,000 lots.
Brent crude futures fell to its lowest level in more than five years below $63 a barrel, under pressure from a glut of oil in the market. Low crude prices raised concern that buyers could shift fuel demand away from palm.
Also, market participants expect December monsoon rains and flooding to significantly curb yields of palm fruit and reduce oil extraction rates.
"Demand is expected to garner momentum in the first quarter next year. Prices will eventually trade circa 2300-2400 ringgit by that period," said Lingam Supramaniam, director at Malaysia-based commodities firm Pelindung Bestari.
In a note to clients, analysts at CIMB said they expected palm oil stocks to fall by 2 percent month-on-month by the end of December to 2.2 million tonnes due to lower production.
"We expect palm oil production to decline by 9 percent month-on-month to 1.6 million tonnes in December 2014 due to seasonal factors," CIMB said.
In competing vegetable oil markets, the U.S. soyoil contract for January edged down 0.3 percent in late Asian trade, while the most active May soybean oil contract on the Dalian Commodity Exchange fell 0.5 percent.
U.S. soybean futures were 0.4 percent lower but were still on track for their second consecutive weekly gain.
India's palm oil imports fell 8 percent to 796,587 tonnes in November from a month earlier, data from the Solvent Extractors' Association of India (SEA) showed.
Palm, soy and crude oil prices at 1001 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC4 2168 -7.00 2145 2190 277
MY PALM OIL JAN5 2158 -22.00 2150 2199 1103
MY PALM OIL FEB5 2171 -24.00 2165 2216 22501
CHINA PALM OLEIN MAY5 5010 -20.00 5002 5054 841794
CHINA SOYOIL MAY5 5662 -28.00 5660 5728 350794
CBOT SOY OIL JAN5 31.93 -4.20 31.91 32.15 31177
INDIA PALM OIL DEC4 419.80 -4.20 417.90 424.70 952
INDIA SOYOIL DEC4 579.00 -1.55 578.70 581.00 6775
NYMEX CRUDE JAN5 59.28 -0.68 58.80 59.52 33882
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= 3.4940 Malaysian ringgit)
($1= 6.1901 Chinese yuan)
($1= 62.4850 Indian rupee)