Palm Futures Ease as Players Take Profits

MALAYSIAN crude palm oil futures ended more than 1 per cent lower on yesterday, as players booked profits after data from cargo surveyors showed lacklustre overseas demand. Malaysia’s August palm oil exports fell 17 per cent from a month ago, as the world’s No. 2 oil consumer China slowed buying due to ample stockpiles. “There’s no sign for China to increase palm oil imports since there are still a lot of stocks in the country, but soybean demand could be higher when weather turns colder,” a trader with a Shanghai-based foreign brokerage said, adding that the country has about 450,000-500,000 tonnes of palm oil inventories at major ports.

However, some Malaysian traders are confident about the vegetable oil’s demand over the following month. “Next month’s demand is not going to slow down due to global supply tightness in most commodities, including the grain and soy complex,” said a trader with a foreign brokerage in Kuala Lumpur. The benchmark November crude palm oil contract on Bursa Malaysia Derivatives Exchange dropped RM35 to RM2,535 per tonne. The Malaysian market was closed the previous day for the national day holiday. “There were some adjustments towards price falls in overseas markets after the public holiday as other vegoils markets fell when we were closed,” said a trader in Kuala Lumpur. Overall traded volume rose to 15,539 lots of 25 tonnes each from the usual 10,000 lots. Oil rose to 72 per barrel in Asian hours after news that Chinese manufacturing growth accelerated last month, easing concerns over the pace of economic recovery. Other vegetable oils were mixed. US soyoil for September delivery rose half a percent in Asian hours, while the most active May soyoil contract on China’s Dalian Commodity Exchange barely moved. “China’s soyoil inched higher on stronger US soyoil prices in the morning. But it doesn’t move much in order to maintain the price level with the physical market,” said a trader in Shanghai. Soyoil spot price yesterday stood at 7,800 yuan (1,146) a tonne. Source : Business Times
]]>

Leave a Reply