Malaysian palm oil price rebounds from 11-mth low on short covering

  • Business Premium
  • Wednesday, 05 Aug 2015

JAKARTA: Volatile Malaysian palm oil futures retreated from 11-month lows on Tuesday, finishing higher while tracking crude oil prices and as traders covered short positions.
    By the close, the benchmark palm oil contract for October on the Bursa Malaysia Derivatives Exchange was up 0.3 percent at 2,060 ringgit ($534) a tonne. 
    "Bargain hunting and short-covering was seen at the new low levels," said a trader with a foreign commodities brokerage in Kuala Lumpur.
    Palm prices fell as far as 2,026 ringgit, their lowest since Sept. 11 last year, and have lost 3 percent so far this month. 
    Traded volume stood at 53,767 lots of 25 tonnes each, well above the roughly 35,000 lots that usually trade in a single session.
    An uncertain demand outlook, exacerbated by economic worries in top buyer China, had weighed on prices during most of Tuesday's session, with traders ignoring upside from a weak ringgit and the potential impact of dry weather spurred by El Nino. 
    In other vegetable oils, the U.S. August soyoil contract eased 0.5
percent in late Asian trade, while the most active soybean oil contract 
on the Dalian Commodity Exchange added 0.1 percent.
    Palm oil, used as cooking oil and to make a range of foodstuffs from instant
noodles to margarines, as well as an additive in biodiesel, typically tracks
soyoil, a common food and fuel substitute for palm.
    Also helping turn palm positive, crude oil prices steadied at $50 a barrel
after a 5 percent drop and badly bruised commodity and Chinese markets were
calmer generally, as investors attempted to shake off recent turbulence.
    Palm may fall into a range of 1,997-2,031 ringgit, driven by a powerful wave
C, said Reuters market analyst Wang Tao. 
  Palm, soy and crude oil prices at 1021 GMT                                                                                                                                                                         
  Contract        Month    Last   Change     Low    High  Volume                                                                                                                                                     
  MY PALM OIL      AUG5    2056    +0.00    2039    2057     133                                                                                                                                                     
  MY PALM OIL      SEP5    2059    +3.00    2024    2074    4235                                                                                                                                                     
  MY PALM OIL      OCT5    2060    +6.00    2026    2073   25891                                                                                                                                                     
  CHINA PALM OLEIN JAN6    4642   -58.00    4596    4666  714354                                                                                                                                                     
  CHINA SOYOIL     JAN6    5446    +6.00    5364    5452  533788                                                                                                                                                     
  CBOT SOY OIL     DEC5   30.35    -0.40   30.11   30.43    7514                                                                                                                                                     
  INDIA PALM OIL   AUG5  407.90    -0.40  404.50  409.00    1487                                                                                                                                                     
  INDIA SOYOIL     AUG5  569.65    +1.20  565.60  570.50   23590                                                                                                                                                     
  NYMEX CRUDE      SEP5   45.96    +0.79   45.29   46.05   34911                                                                                                                                                     
  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 = 3.8570 ringgit)
($1 = 63.7600 Indian rupees)
($1 = 6.2086 Chinese yuan)
- Reuters

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