KUALA LUMPUR: Malaysian palm oil futures inched up on Thursday, tracking gains in crude markets, but uncertainty over global appetite for the vegetable oil and prospects of a faster-than-expected recovery in weather-hit yields kept prices rangebound.
An improved view on global crude demand saw oil rise above
$62 a barrel on Thursday after comments from Saudi Arabia's oil
minister lifted Brent futures 5 percent on Wednesday, helping
both Brent and U.S. crude to record their largest percentage
gain in nearly two weeks.
Higher oil prices could tempt biodiesel producers to begin
blending palm oil into biofuels again, after the rout in crude
wiped out blending margins.
But sluggish exports in February and forecasts by a
Malaysian growers' group for output to rise this month have made
investors cautious against taking big risks in the market.
"The market has no certainty. People want to see the outlook
for this year, so there's no clear direction for now," said a
trader with a foreign commodities brokerage in Kuala Lumpur.
"Prices will be range-trading between 2,200 to 2,300 ringgit
until the palm oil conference," the trader added, referring to a
key industry meeting in Kuala Lumpur next week.
The benchmark May contract on the Bursa Malaysia
Derivatives Exchange had gained 1.25 percent to 2,276 ringgit
($635) per tonne.
Traded volume stood at 44,048 lots of 25 tonnes each, above
the usual 35,000 lots.
The Malaysian Palm Oil Association, a group of planters, on
Wednesday forecast crude palm oil output in the No.2 grower rose
4.5 percent between Feb. 1-20, lifted by a recovery in
Peninsular Malaysian estates.
The unexpected forecast ran counter to trade estimates for a
third month of weaker production after monsoon rains disrupted
harvesting and lowered quality in flood-hit estates.
Elsewhere, Malaysia's Sime Darby Bhd
, the world's
top palm oil planter by land size, announced on Thursday a 47
percent fall in second-quarter profit, dragged down by weak
commodity prices between October and December.
Sime Darby's chief executive added that palm prices are
likely to hover between 2,300 ringgit and 2,500 ringgit per
tonne until June 2015.
In competing vegetable oil markets, the most active May
soybean oil contract on the Dalian Commodity Exchange
rose 0.98 percent, while the U.S. soyoil contract for May
edged up 0.79 percent.
By 1023 GMT, Brent rose 71 cents to 62.34, while U.S. crude
fell 40 cents to 50.59.
Palm, soy and crude oil prices at 1053 GMT
Contract Month Last Change Low High Volume
MY PALM OIL MAR5 2293 +34.00 2266 2295 919
MY PALM OIL APR5 2281 +29.00 2259 2287 6930
MY PALM OIL MAY5 2277 +28.00 2256 2284 25537
CHINA PALM OLEIN MAY5 4962 +46.00 4936 4974 116924
CHINA SOYOIL MAY5 5558 +54.00 5512 5570 175304
CBOT SOY OIL MAY5 32.15 +0.50 31.81 32.21 6508
INDIA PALM OIL FEB5 453.30 +0.50 452.50 453.90 150
INDIA SOYOIL APR5 596.30 +3.40 593.90 597.50 17640
NYMEX CRUDE APR5 50.54 -0.45 50.31 51.22 53855
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel
($1 = 3.5820 ringgit)
($1 = 6.2584 Chinese yuan renminbi)
($1 = 61.7600 Indian rupees)
- Reuters
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