Crude palm oil futures rose 1.3 per cent yesterday, but came off a one-week high hit earlier in the day following market talk of a drop in palm oil exports for the August 1-25 period, traders said.
Palm gave up about half of the day’s gain after news leaked out that Malaysian palm oil exports in the Aug. 1-25 period dropped 12 per cent from the previous month to 986,000 tonnes.
“This is the main reason why the market failed to move up higher after going above RM2,400 early,” said a trader at a commodities brokerage.
“I would say the market has to digest poor export numbers but, on the other hand, production is also declining so stock should stay low, below 1.4 million tonnes,” the trader said, referring the minimum stocks requirement seen as needed for the processing industry to function normally.
Palm prices are inversely correlated with palm oil stocks.
Benchmark November palm oil futures on the Bursa Malaysia Derivatives Exchange settled up RM30 to RM2,375 per tonne, after rising as high as RM2,402, a level not seen since Aug. 14.
Overall volume was 17,937 lots of 25 tonnes each.
In the physical market, palm oil for August and September delivery was traded at RM2,460-RM2,470 in the southern and central regions. Source : Business Times]]>