05 July 2002 (Business Times) - MALAYSIA’s palm oil market expects biggestbuyer, India, to go on a buying spree anytime soon as it stocks upsupplies in anticipation of the Deepavali celebrations in November.

Traders said now is the time of the year when India would normally startbuying forward to ensure delivery in October just in time for thecelebrations and avoid any last minute shortage.

“Anticipation is high in the market right now and traders are bracingthemselves for any sudden large purchases from India,” a trader toldBusiness Times in Kuala Lumpur yesterday.

India is a traditional buyer of Malaysia’s palm oil and was the biggestbuyer for the past several years, buying 2.38 million tonnes in 1999 and2.03 million tonnes last year.

Between January and May 2002, the sub-continent bought 713,281 tonnes, a24.2 per cent drop compared with 939,971 tonnes in the first six months oflast year.

“India bought an additional 30,000 tonnes last week which may signal thestart of bigger purchases in the next few weeks,” said the trader.

He said official palm oil production figures in June are expected tocontinue registering below the psychological one million tonne mark atabout 950,000 tonnes, which should sustain prices.

At the Malaysia Derivatives Exchange, crude palm oil futures closed loweryesterday with the benchmark third month September delivery easing RM14 toclose at RM1,305 a tonne.

July, August and October deliveries each closed lower by RM9, RM17 andRM11 at RM1,307, RM1,301 and RM1,309 respectively.

Turnover decreased by 705 lots to close at 5,160 while open positionseased 1,627 contracts at 14,725.

(The informations and opinions expressed in this article represent theviews of the author only. They should not be seen as necessarilyreflecting the views of Palm News)