News
12.11.2009
Malaysian palm oil extends losses
Malaysian crude palm oil futures dropped 0.4 percent on Wednesday, extending recent losses, on high stock levels. But expectations for exports to gather steam in November boosted support at the lower levels and traders said palm oil holding a $120-$130 discount to rival soyoil should keep orders flowing in.
The benchmark January contract on Bursa Malaysia Derivatives Exchange settled down 8 ringgit at 2,234 ringgit ($662.1) per tonne. Trade volumes more than halved to 5,092 lots of 25 tonnes each. "News of high stocks for October is old but still weighs on the market," said a trader with a foreign commodities brokerage. "Stronger exports in November should contribute to the stocks drawdown."
Malaysian palm oil stocks in October surged 25 percent to hit a 10-month high due to output growing faster than exports. Traders do not expect a repeat of last month's high production as due to heavy rains and floods in November. November exports in Malaysia are off to a good start with cargo surveyor Societe Generale de Surveillance reporting a jump of 22 percent in the first ten days to 421,311 tonnes from the same period a month ago.
Palm oil prices bucked the trend of higher vegetable oil markets on Wednesday. US soyoil for December delivery gained 1 percent on the back of strengthening crude oil prices. The most active September 2010 soybean oil contract on China's Dalian Commodity Exchange edged higher.
INDONESIAN TRADES In Indonesia, the state marketing centre, based in Jakarta, sold 12,000 tonnes of palm oil at a top price of 6,573 rupiah ($0.700) per kg against 6,549 rupiah on Tuesday. Producers in Medan, home to Indonesia's main palm oil export port of Belawan, did not hold a palm oil tender on Wednesday. Refiners in Jakarta offered refined, bleached, deodorised (RBD) palm oil, used as cooking oil, at 6,450 rupiah per kg against 6,500 rupiah a day earlier.
Reuters
