SINGAPORE: Malaysian palm oil futures edged lower on Monday, as investor caution set in ahead of key industry data that could show end-stocks creeping higher in the world’s No.2 producer.
Industry regulator the Malaysian Palm Oil Board (MPOB) is due to release August stocks data on Tuesday, which may show an increase to 1.73 million tonnes, the highest level in three months as output outweighed exports, a Reuters survey showed.
Cargo surveyors Intertek Testing Services and Societe Generale de Surveillance are also reporting Malaysian September 1-10 exports data on Tuesday.
“The market should be quite rangebound today, with traders positioning ahead of MPOB and exports data tomorrow. Stocks are likely to be flat or higher and hopefully exports for the first 10 days are stronger,” said a trader with a foreign commodities brokerage in Kuala Lumpur.
By the mid-day break, the benchmark November contract on the Bursa Malaysia Derivatives Exchange had lost 0.5 per cent to RM2,431 per tonne, after trading in a tight range between RM2,425 to RM2,449.
Total traded volume stood at 11,857 lots of 25 tonnes each, a tad lower than the usual 12,500 lots.
Traders are expecting higher overseas demand for palm oil in August to continue into September as key buyer China restocks ahead of the Mid-Autumn festival later this month.
Market participants are also keeping a close watch on the ringgit this week. The tropical oil enjoyed a surge in buying interest last week thanks to the weaker Malaysian currency, which makes the feedstock cheaper for overseas buyers and refiners.
In other markets, Brent crude futures eased in early Asian trade on Monday as investors took profits following gains of one per cent in the last two sessions on the back of uncertainty over a possible US military strike against Syria.
In vegetable oil markets, the US soyoil contract for December gained 0.5 per cent in early Asian trade. The most-active January soybean oil contract on the Dalian Commodities Exchange edged up 0.6 per cent.– Reuters
Source : Business Times