Malaysian palm oil price was little changed on volatile ringgit, rising stocks

KUALA LUMPUR: Malaysian palm oil futures were little changed in light trade on Thursday, stretching their losing streak into a fourth day due to a rise in the ringgit and higher stocks in the No.2 grower.

Data from regulator the Malaysian Palm Oil Board showed palm oil stocks last month swelled to their highest since November to stand at 2.24 million tonnes, overturning expectations that robust export demand would dent inventories.

The August palm oil contract on the Bursa Malaysia Derivatives exchange was nearly flat at 2,290 ringgit ($611.48) a tonne by the day’s close.

“The reliable support at 2,320 ringgit gave way and now it is checking the next support at 2,280 ringgit, which may break soon,” said a trader with a foreign commodities brokerage in Kuala Lumpur, adding that a sell signal may be triggered if the price falls to 2,279 ringgit.

Traded volume was thin at 29,584 lots of 25 tonnes each, below the more usual 35,000 lots.

Analysts say the pace of shipments may cool in June ahead of the Muslim Ramadan festival that starts in the middle of the month.

“We expect the growth momentum to moderate this month as the bulk of stocking-up activity ahead of the Ramadan celebrations is likely to be completed,” Kenanga Investment Bank said.

“The higher soybean oil to CPO premium could serve as a demand catalyst, but we expect this to be temporary due to the ample supply of soybeans in the market,” the research house added.

Cargo surveyors on Wednesday reported that exports of Malaysian palm oil products for June 1-10 rose about 2 percent to between 468,975 and 473,307 tonnes compared to the May 1-10 period, signalling a slowdown in the surge in buying.

The Malaysian ringgit dropped Thursday to trade at 3.7450 per dollar by 1020 GMT. On Monday, the currency had slumped to 3.7680, the weakest in nine years.

In other markets, oil prices steadied on Thursday as a bullish report from the International Energy Agency (IEA) balanced a gloomy outlook from the World Bank, which cut its global economic growth forecast.

In competing vegetable oil markets, the U.S. July soyoil contract was flat in late Asian trade, while the most active September soybean oil contract on the Dalian Commodity Exchange gained 0.5 percent.

Palm, soy and crude oil prices at 1021 GMT
                                                                                                     
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      JUN5       0    +0.00       0    2284       0
  MY PALM OIL      JUL5    2281    -6.00    2276    2293    1886
  MY PALM OIL      AUG5    2290    -1.00    2280    2303   16382
  CHINA PALM OLEIN JAN6    5256    -8.00    5214    5286  823288
  CHINA SOYOIL     SEP5    5764   +28.00    5736    5782  363006
  CBOT SOY OIL     JUL5   33.87    -2.20   33.81   34.04    4207
  INDIA PALM OIL   JUN5  455.20    -2.20  453.10  457.80     998
  INDIA SOYOIL     JUN5  607.40    -0.15  605.80  607.70    8625
  NYMEX CRUDE      JUL5   60.89    -0.54   60.72   61.53   32119
                                                                                                     
  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 = 3.7450 ringgit)
($1 = 6.2065 Chinese yuan)
($1 = 63.96 Indian rupees)
– Reuters

Source : The Star

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