VEGOILS-Palm gains over 1 pct on recovering demand outlook
Reuters (29/01/2018) - * Palm sees sharpest rise in nearly one month
* Stable ringgit, stronger related oils support - traders
* Palm may test support at 2,462 rgt/T - technicals
KUALA LUMPUR, Jan 29 (Reuters) - Malaysian palm oil futures rose more than 1 percent at midday on Monday, its sharpest gain since the start of the year, on expectations demand will recover and as the ringgit, the tropical oil's currency of trade, fell in early trade.
A stronger ringgit usually makes palm oil more expensive for holders of foreign currencies and reduces demand. Palm oil prices were weighed down last week after the central bank raised interest rates, lending support to the ringgit.
The ringgit has appreciated 4 percent since the start of the year, and has gained over a fifth of its value since 2017, inline with improving crude oil prices. The currency fell 0.1 percent earlier in the day and was last up 0.05 percent against the dollar at 3.8670.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange was up 1.3 percent at 2,517 ringgit ($650.89) a tonne at the midday break, its sharpest gain since Jan. 3.
Trading volumes stood at 11,690 lots of 25 tonnes each at noon. Expectations of stronger exports is supporting the market, said a trader from Kuala Lumpur. "We're expecting to see smaller negative growth," he said, referring to cargo surveyors' export data scheduled for release on Wednesday.
Palm oil shipments from Malaysia during Jan. 1-25 fell about percent versus the corresponding period last month. The drop is weaker compared with the Jan. 1-20 period, which saw declines of 13-16 percent.
Gains in competing vegetable oils such as soyoil also supported palm, another trader said. Palm oil prices track movements in other related edible oils, as they compete for a share in the global vegetable oils market.
The March soybean oil contract on the Chicago Board of Trade rose 0.4 percent, while the May soybean oil on the Dalian Commodity Exchange was up 0.5 percent.
In other related edible oils, the Dalian May palm oil contract also edged up 0.5 percent. Palm oil may test a support at 2,462 ringgit, as it has broken a higher support at 2,491 ringgit per tonne, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
Palm, soy and crude oil prices as of 0519 GMT
Contract Month Last Change Low High Volume
MY PALM OIL FEB8 2512 +30.00 2500 2513 113
MY PALM OIL MAR8 2518 +35.00 2490 2518 394
MY PALM OIL APR8 2517 +33.00 2488 2519 5996
CHINA PALM OLEIN MAY8 5252 +24.00 5208 5264 209396
CHINA SOYOIL MAY8 5820 +26.00 5782 5832 220898
CBOT SOY OIL MAR8 32.91 +0.12 32.84 32.93 3477
INDIA PALM OIL JAN8 563.00 +0.60 562.00 564.8 111
INDIA SOYOIL FEB8 750.95 +3.95 750.7 754.4 8360
NYMEX CRUDE MAR8 66.36 +0.22 66.10 66.46 40667
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 = 3.8670 ringgit)
($1 = 63.5175 Indian rupees)
($1 = 6.3230 Chinese yuan)