JAKARTA: Malaysian palm oil futures inched up on Monday as weakness in the ringgit and gains in competing vegetable oils encouraged buying.
The benchmark June contract on the Bursa Malaysia Derivatives
Exchange rose 0.14 percent to 2,131 ringgit ($575) a tonne. Total traded volume
stood at 46,208 lots of 25 tonnes, above the usual 35,000 lots.
"The market is up on the back of the weak ringgit, better export prospects,
strong soy oil and positive Dalian market," said a trader with a foreign
commodities brokerage in Kuala Lumpur. "Prices are range-bound from 2,100 to
2,200 (ringgit)."
The ringgit fell 1 percent to 3.7040 per dollar, its weakest since April 1,
as interbank speculators and leveraged funds sold the Malaysian currency.
A weak ringgit can make palm prices effectively cheaper for overseas buyers.
A leading vegetable oil analyst's negative outlook for palm prices did not
dampen trading on Monday.
Palm prices will likely trade between 2,100 ringgit and 2,300 ringgit until
May, analyst Dorab Mistry said on Monday, cutting an earlier estimate by as much
as 16 percent because of poor demand and slow biofuels take-up.
"Mistry's views are long-term, they'll materialise in the second half of the
year. The bullish factors today are just a short-term correction," the Kuala
Lumpur-based trader said.
In competing vegetable oil markets, the U.S. soyoil May contract rose
0.13 percent in early Asian trade, while the most active September soybean oil
contract on the Dalian Commodity Exchange was up 1.53 percent.
Figures from last week showed strength in Malaysian palm exports in the
first 10 days of April, which rose 29.4 percent from the same period the
previous month, according to cargo survey company Societe Generale de
Surveillance.
Palm oil may end its current rebound around resistance at 2,165 ringgit a
tonne and then fall towards a support at 2,137 ringgit, as indicated by a
Fibonacci retracement analysis, Reuters analyst Wang Tao said.
In other markets, Brent oil prices rose towards $59 a barrel on Monday in a
volatile market, continuing gains after a strong end to last week as financial
traders increased bets on higher prices amid a slowdown in U.S. drilling.
Palm, soy and crude oil prices at 1043 GMT
Contract Month Last Change Low High Volume
MY PALM OIL MAY5 2142 +4.00 2138 2170 3345
MY PALM OIL JUN5 2129 +3.00 2126 2160 25800
CHINA PALM OLEIN SEP5 4676 +32.00 4636 4688 430286
CHINA SOYOIL SEP5 5452 +82.00 5368 5462 647318
CBOT SOY OIL MAY5 31.13 -0.60 30.92 31.36 8675
INDIA PALM OIL APR5 431.80 -0.60 430.50 434.80 743
INDIA SOYOIL APR5 600.00 +1.35 599.50 603.00 11140
NYMEX CRUDE MAY5 52.20 +0.56 51.47 53.10 50225
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 = 3.7050 ringgit)
($1 = 6.2152 Chinese yuan)
($1 = 62.4900 Indian rupees)
- Reuters
Win a prize this Mother's Day by subscribing to our annual plan now! T&C applies.
