Malaysian palm oil price rebounds from 11-mth low on short covering

JAKARTA: Volatile Malaysian palm oil futures retreated from 11-month lows on Tuesday, finishing higher while tracking crude oil prices and as traders covered short positions.

By the close, the benchmark palm oil contract for October on the Bursa Malaysia Derivatives Exchange was up 0.3 percent at 2,060 ringgit ($534) a tonne.

“Bargain hunting and short-covering was seen at the new low levels,” said a trader with a foreign commodities brokerage in Kuala Lumpur.

Palm prices fell as far as 2,026 ringgit, their lowest since Sept. 11 last year, and have lost 3 percent so far this month. 

Traded volume stood at 53,767 lots of 25 tonnes each, well above the roughly 35,000 lots that usually trade in a single session.

An uncertain demand outlook, exacerbated by economic worries in top buyer China, had weighed on prices during most of Tuesday’s session, with traders ignoring upside from a weak ringgit and the potential impact of dry weather spurred by El Nino.

In other vegetable oils, the U.S. August soyoil contract eased 0.5 percent in late Asian trade, while the most active soybean oil contract on the Dalian Commodity Exchange added 0.1 percent.

Palm oil, used as cooking oil and to make a range of foodstuffs from instant noodles to margarines, as well as an additive in biodiesel, typically tracks soyoil, a common food and fuel substitute for palm.

Also helping turn palm positive, crude oil prices steadied at $50 a barrel after a 5 percent drop and badly bruised commodity and Chinese markets were calmer generally, as investors attempted to shake off recent turbulence.

Palm may fall into a range of 1,997-2,031 ringgit, driven by a powerful wave C, said Reuters market analyst Wang Tao. 
    
Palm, soy and crude oil prices at 1021 GMT                                                                                                          

Contract        
Month
 Last
Change
  Low
 High
Volume
MY PALM OIL    
 AUG5
 2056
 +0.00
 2039
 2057
  133
MY PALM OIL    
 SEP5
 2059
 +3.00
 2024
 2074
 4235
MY PALM OIL    
 OCT5
 2060
 +6.00
 2026
 2073
25891
CHINA PALM OLEIN
JAN6
 4642
-58
 4596
 4666
714354
CHINA SOYOIL    
JAN6
 5446
 +6.00
 5364
 5452
533788
CBOT SOY OIL    
DEC5
30.35
 -0.40
30.11
30.43
 7514
INDIA PALM OIL  
AUG5
407.9
 -0.40
404.5
409
 1487
INDIA SOYOIL    
AUG5
569.65
 +1.20
565.6
570.5
23590
NYMEX CRUDE    
 SEP5
45.96
 +0.79
45.29
46.05
34911

   
  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 k g                                                                                                                                                                            
  Crude in U.S. dollars per barrel                                                                                                                                                                                   
    
($1 = 3.8570 ringgit)
($1 = 63.7600 Indian rupees)
($1 = 6.2086 Chinese yuan)
– Reuters

Source : The Star

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