MARKET DEVELOPMENT
VEGOILS-Palm Drops to Near 3-wk Low as Ringgit Advances Over 1 Pct
VEGOILS-Palm Drops to Near 3-wk Low as Ringgit Advances Over 1 Pct
* Malaysian currency rises to 2-wk high of 3.7090 per U.S. dollar
* FDA ban on trans fats may lift palm consumption in U.S.-analyst
19/06/2015 (Reuters) - Malaysian palm oil futures fell to their lowest in nearly three weeks on Thursday as the
ringgit advanced and competing soyoil markets overseas weighed on sentiment.
Palm typically tracks soy, a rival edible oil, as both are commonly used as food and fuel substitutes.
The Malaysian ringgit rose 1.3 percent to trade at 3.7090 per U.S. dollar on Thursday, its strongest in two weeks, turning away some overseas buyers from the ringgit-priced palm feedstock.
"It's mainly because of the weaker overnight CBOT and strengthening of ringgit," said Chee Wei Chan, a broker with Kenanga Deutsche Futures in Malaysia.
The U.S. July soyoil contract fell 0.6 percent in early Asian trade, while the most active January soybean oil
contract on the Dalian Commodity Exchange lost 0.5 percent.
Chee added that threats to yields from the weather phenomenon El Nino have yet to make a real impact on prices.
"El Nino is still on paper board. Its real effect stillhasn't kicked in. So, a sell-down from here is quite normal."
By the midday break, the September palm oil contract on the Bursa Malaysia Derivatives exchange had inched down 1.7 percent to 2,253 ringgit ($605.81) a tonne. Prices in early trade touched 2,252 ringgit, their lowest since May 29.
Total traded volume stood at 21,429 lots of 25 tonnes each, nearly double the usual 12,500 lots.
Elsewhere, analysts say the U.S. Food and Drug Administration's (FDA) decision to ban artificial fats from a
wide range of foods such as microwave popcorn to frozen pizza in three years may result in food makers switching to palm oil from soyoil.
However, the uptake in the tropical oil may not be significant enough to move prices. Palm, the world's most traded vegetable oil, is a naturally transfat-free edible oil.
"Assuming 50 percent of the remaining estimated hydrogenated fats in the United States are replaced with palm oil, we estimate this could raise demand for palm oil in the United States by 156,000-453,000 tonnes over the next three years," said Ivy Ng, regional head of plantations research at CIMB Investment Bank.
"This is not a significant figure relative to global crude palm oil output of 60 million tonnes," Ng said in a note.
In other markets, oil prices slipped on Thursday after U.S. government data showed gasoline stocks and distillate inventories rose last week, although the falls were checked by continuing Middle East geopolitical tensions and a weaker U.S. dollar.
Palm, soy and crude oil prices at 0526 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JUL5 2250 -38.00 2250 2265 206
MY PALM OIL AUG5 2253 -38.00 2252 2270 5438
MY PALM OIL SEP5 2253 -38.00 2252 2270 11187
CHINA PALM OLEIN JAN6 5148 -40.00 5134 5216 510848
CHINA SOYOIL JAN6 5892 -28.00 5882 5962 418324
CBOT SOY OIL JUL5 32.64 -2.30 32.63 32.85 2563
INDIA PALM OIL JUN5 451.00 -2.30 450.10 451.80 202
INDIA SOYOIL JUN5 608.20 -1.95 607.70 609.50 210
NYMEX CRUDE JUL5 59.63 -0.29 59.51 59.85 5252
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 = 3.7190 ringgit)
($1 = 6.2093 Chinese yuan)
($1 = 63.86 Indian rupees)
* FDA ban on trans fats may lift palm consumption in U.S.-analyst
19/06/2015 (Reuters) - Malaysian palm oil futures fell to their lowest in nearly three weeks on Thursday as the
ringgit advanced and competing soyoil markets overseas weighed on sentiment.
Palm typically tracks soy, a rival edible oil, as both are commonly used as food and fuel substitutes.
The Malaysian ringgit rose 1.3 percent to trade at 3.7090 per U.S. dollar on Thursday, its strongest in two weeks, turning away some overseas buyers from the ringgit-priced palm feedstock.
"It's mainly because of the weaker overnight CBOT and strengthening of ringgit," said Chee Wei Chan, a broker with Kenanga Deutsche Futures in Malaysia.
The U.S. July soyoil contract fell 0.6 percent in early Asian trade, while the most active January soybean oil
contract on the Dalian Commodity Exchange lost 0.5 percent.
Chee added that threats to yields from the weather phenomenon El Nino have yet to make a real impact on prices.
"El Nino is still on paper board. Its real effect stillhasn't kicked in. So, a sell-down from here is quite normal."
By the midday break, the September palm oil contract on the Bursa Malaysia Derivatives exchange had inched down 1.7 percent to 2,253 ringgit ($605.81) a tonne. Prices in early trade touched 2,252 ringgit, their lowest since May 29.
Total traded volume stood at 21,429 lots of 25 tonnes each, nearly double the usual 12,500 lots.
Elsewhere, analysts say the U.S. Food and Drug Administration's (FDA) decision to ban artificial fats from a
wide range of foods such as microwave popcorn to frozen pizza in three years may result in food makers switching to palm oil from soyoil.
However, the uptake in the tropical oil may not be significant enough to move prices. Palm, the world's most traded vegetable oil, is a naturally transfat-free edible oil.
"Assuming 50 percent of the remaining estimated hydrogenated fats in the United States are replaced with palm oil, we estimate this could raise demand for palm oil in the United States by 156,000-453,000 tonnes over the next three years," said Ivy Ng, regional head of plantations research at CIMB Investment Bank.
"This is not a significant figure relative to global crude palm oil output of 60 million tonnes," Ng said in a note.
In other markets, oil prices slipped on Thursday after U.S. government data showed gasoline stocks and distillate inventories rose last week, although the falls were checked by continuing Middle East geopolitical tensions and a weaker U.S. dollar.
Palm, soy and crude oil prices at 0526 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JUL5 2250 -38.00 2250 2265 206
MY PALM OIL AUG5 2253 -38.00 2252 2270 5438
MY PALM OIL SEP5 2253 -38.00 2252 2270 11187
CHINA PALM OLEIN JAN6 5148 -40.00 5134 5216 510848
CHINA SOYOIL JAN6 5892 -28.00 5882 5962 418324
CBOT SOY OIL JUL5 32.64 -2.30 32.63 32.85 2563
INDIA PALM OIL JUN5 451.00 -2.30 450.10 451.80 202
INDIA SOYOIL JUN5 608.20 -1.95 607.70 609.50 210
NYMEX CRUDE JUL5 59.63 -0.29 59.51 59.85 5252
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 = 3.7190 ringgit)
($1 = 6.2093 Chinese yuan)
($1 = 63.86 Indian rupees)