Palm Oil Advances for First Time in 6 Days

PALM oil gained for the first time in six days yesterday as advancesin soybeans and soybean oil boosted its appeal as an alternative in cooking and biofuel. Prices gained as much as 1.4 per cent after soybeans jumped the most in more than two weeks in Chicago on Wednesday on speculation that food and animal-feed makers stepped up purchases after prices slid to a two-month low. “With all of the bullishness seen in oilseeds overnight, expect palm to rally today,” said Scott Briggs, the agricultural commodities strategist at Australia & New Zealand Banking Group Ltd, in a report yesterday.

March-delivery palm oil rose 0.8 per cent to RM2,530 a metric ton on the Malaysia Derivatives Exchange. Palm oil lost most of its early gains, tracking soybean oil in Asian trading, on investors’ concerns that edible oils supplies are ample. While there’s speculation of an “improvement in shipment” of Malaysian palm oil for the first half of January, “end- January stocks will be massive,” said Ryan Long, a futures trader at OSK Investment Bank Bhd in Kuala Lumpur. Palm oil stockpiles in Malaysia, the largest producer after Indonesia, surged 16 per cent in December to the second highest on record, at 2.24 million metric tons. Output in December dropped 4.7 per cent to 1.52 million tons while exports slumped 20 per cent to 1.21 million tons, the country’s Palm Oil Board said January. 11. Two independent cargo surveyors are due to report preliminary January 1-15 export data today. On January. 12, the US also forecast a record soybean crop of 3.361 billion bushels, 1.3 per cent more than was projected last month and 13 per cent more than last year’s harvest, the U.S. Department of Agriculture said on Wednesday. World soybean production in the crop year that began October. 1 will be a record 253.4 million metric tons, up from 250.3 million tons forecast a month ago and 210.9 million produced last year, according to the US report. Source : Business Times

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