KUALA LUMPUR: Malaysian palm oil futures ended higher on Monday after touching their lowest level this month, lifted by strong exports in the No.2 grower, but a delay to export levies in the world's top producer Indonesia mounted some pressure onto the contract.
Cargo surveyor Intertek Testing Services (ITS) reported
exports of Malaysian palm oil products for May 1-25 rose 52.9
percent to 1,382,782 tonnes from 904,112 tonnes shipped during
April 1-25. Shipments of crude palm oil surged to 528,143 tonnes
during the period, from 58,500 tonnes a month ago.
"Prices recovered in the afternoon on the back of very good
export numbers," said a trader with a foreign commodities
brokerage in Kuala Lumpur.
But palm will likely remain rangebound between 2,100-2,170
ringgit as weak comparative markets dampen sentiment, the trader
added. "Local sentiment for export is very good but overseas the
Dalian and other edible oil markets are weak."
The benchmark August contract on the Bursa
Malaysia Derivatives exchange had edged up 0.3 percent to 2,141
ringgit ($592.50) a tonne by Monday's close. It earlier touched
2,121 ringgit, its lowest level since April 30.
Total traded volume stood at 35,654 lots of 25 tonnes each,
above the average 35,000 lots.
A delay to the implementation of a levy by the world's No.1
producer Indonesia also turned investors uncertain.
"The delayed levy is creating lots of uncertainty, which
equals delay in buying," said second palm trader in Malaysia.
"Stiff competition from Indonesia is the reason behind the lower
prices."
Indonesia's finance minister said the regulation, which will
force exporters in Indonesia to pay a levy of $50 per tonne on
shipments of crude palm oil and $30 for processed palm oil,
could only come in two weeks after public body that will collect
the palm levy is ready.
The Indonesian Palm Oil Association on Friday told Reuters
that delays in establishing guidelines and a new biodiesel fund
or agency meant the implementation date would be pushed back as
far as August, from earlier announcements that the levy would be
introduced in the fourth week of May.
In other markets, crude oil futures dipped below $65 a
barrel as the dollar strengthened on Monday, with a public
holiday in the United States and much of Europe keeping oil
trading volumes muted.
Palm traders are also keeping a watch on the U.S. soy crop
progress - bigger supplies of the oilseed for crushing into
rival soyoil could water down demand for the tropical oil.
Warmer temperatures have been forecast in the coming days in
the U.S. Midwest crop belt which are seen as favourable for
developing corn and soybean plants.
The most active September soybean oil contract on
the Dalian Commodity Exchange was down 0.8 percent in late Asian
trade. The U.S. July soy markets were closed for the U.S.
Memorial Day holiday.
Palm, soy and crude oil prices at 1029 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JUN5 2137 +5.00 2126 2142 280
MY PALM OIL JUL5 2145 +7.00 2124 2154 7075
MY PALM OIL AUG5 2141 +6.00 2121 2151 18552
CHINA PALM OLEIN SEP5 4918 -20.00 4876 4934 461842
CHINA SOYOIL SEP5 5672 -46.00 5632 5694 512664
CBOT SOY OIL JUL5 31.67 -0.20 0.00 0.00 0
INDIA PALM OIL MAY5 447.50 -0.20 445.70 448.30 240
INDIA SOYOIL JUN5 592.00 -3.50 590.00 596.00 17680
NYMEX CRUDE JUL5 59.40 -0.32 59.10 60.06 16362
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 = 3.6135 ringgit)
($1 = 6.2020 Chinese yuan)
($1 = 63.55 Indian rupees)
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