Malaysian palm oil price jumps to new high in late trade on low supply concerns

The palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange surged 2.4 percent to 2,608 ringgit ($638) per tonne at the end of the trading day. It earlier reached a new three-week and intraday high of 2,612 ringgit. Traded volume stood at 48,005 lots of 25 tonnes each on Friday.

KUALA LUMPUR: Malaysian palm oil futures jumped in Asian evening trade on Friday, rebounding from losses a day ago, as low supply concerns and bullish price sentiments from an industry conference fueled the market rally.
    Experts at an industry conference in Kuala Lumpur on Wednesday had forecast palm to trade at 2,700-3,000 ringgit per tonne by June as a crop-damaging El Nino is expected to impact yields and lower annual output growth.
    The palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange surged 2.4 percent to 2,608 ringgit ($638) per tonne at the end of the trading day. It earlier reached a new three-week and intraday high of 2,612 ringgit.
    Traded volume stood at 48,005 lots of 25 tonnes each on
Friday.
    "It's a supply driven rally, aided and abetted by speculative buying and massive short covering," said a trader from Kuala Lumpur. 
    An El Nino weather event brings heavy rains to South America
but scorching heat across Southeast Asia, reducing palm's fresh
fruit yields and lowering production. Analysts at the Kuala
Lumpur conference forecast that global production for palm oil
would fall by 2-3 million tonnes.
   
    Government data from Malaysia, the world's second largest
producer of palm, showed that February output fell to its lowest
since 2007 at 1.04 million tonnes, a 7.7 percent decline from a
month ago. 
    Palm oil may test a resistance at 2,595 ringgit per tonne, a
break above which could lead to a gain to the next resistance at
2,614 ringgit, said Wang Tao, a Reuters market analyst for
commodities and energy technicals. 
    In competing vegetable oil markets, the May soybean oil
contract on the Dalian Commodity Exchange rose 1.2
percent.
   
  Palm, soy and crude oil prices at 1051 GMT:    
    
 Contract          Month   Last    Change  Low    High   Volume
 MY PALM OIL        6-Mar    2549      60   2505   2549       92
 MY PALM OIL        6-Apr    2599      67   2548   2599     1898
 MY PALM OIL        6-May    2607      62   2561   2612    24693
 CHINA PALM OLEIN   6-May    5118     -14   5048   5156   660144
 CHINA SOYOIL       6-May    5788      70   5674   5828   390094
 CBOT SOY OIL       6-May   32.17     7.7   31.6  32.21    12879
 INDIA PALM OIL     6-Mar   505.6     7.7  499.5  507.4     2414
 INDIA SOYOIL       6-Mar  614.65     6.7    610    615    11140
 NYMEX CRUDE        6-Apr   38.77    0.93  37.92  38.96    61087
 
 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 = 4.0860 ringgit)
($1 = 67.1300 Indian rupees)
($1 = 6.4989 Chinese yuan)
- Reuters