Malaysian palm oil price falls to 3-wk low over demand uncertainty

KUALA LUMPUR: Malaysian palm oil futures fell to their lowest in over three weeks on Monday as the ringgit nudged up and lacklustre exports in the first 20 days of the month signalled dwindling demand for the edible oil.
    Exports of Malaysian palm products for June 1-20 inched up
0.4 percent to 1,074,410 tonnes from a month earlier, a report
from cargo surveyor Intertek Testing Services showed, as India
and China scaled back purchases. 
    Another cargo surveyor Societe Generale de Surveillance
showed exports rose 3.3 percent in the same period. 
    "Last month exports were very strong. We don't know if
demand will fade away, especially in the last 10 days of this
month. It's very uncertain," said a trader with a foreign
commodities brokerage in Kuala Lumpur.
    Production would need to ease to reduce stockpiles, which
have swollen to a six-month high of 2.24 million tonnes, the
trader added.
    Market participants expect crude palm oil output in
Malaysia, the world's No.2 grower, to weaken during the Muslim
holy month of Ramadan and the Eid al-Fitr festival as plantation
workers go on holiday.
    The September palm oil contract on the Bursa
Malaysia Derivatives exchange had edged down 0.8 percent to
2,220 ringgit ($595.17) a tonne by Monday's close, after
touching 2,218 ringgit in late trade, their lowest since May 29.
    Trading was relatively light as Chinese markets were closed
for a holiday. Total traded volume stood at only 29,382 lots of
25 tonnes each, below the usual 35,000 lots.   
    "The market is very lethargic because of China's holiday.
Many people are not in the market," the Kuala Lumpur trader
said. 
    Technicals show palm oil prices will probably see a target
of 2,216 ringgit but face resistance at 2,250 ringgit, according
to Reuters market analyst Wang Tao.    
    The Malaysian ringgit gained 0.2 percent to 3.7300
per U.S. dollar on Monday.
    Palm's top consumer, India, may import 13 million tonnes of
edible oil in the 2014/15 marketing year to October, 12 percent
more than the previous year as drought has hurt domestic soybean
crops and cheap palm prices have stoked buying appetite, the
Solvent Extractors' Association of India said. 
    India mainly buys palm oil from Indonesia and Malaysia,
along with soyoil from Argentina and Brazil.   
    In other markets, oil prices rose above $63 a barrel in
response to new proposals from Greece that the European Union
welcomed as a basis for progress at talks to try to stave off a
default that could cause turmoil in financial markets. 
    The U.S. July soyoil contract was nearly flat in late
Asian trade. The Dalian Commodity Exchange is closed for the
Chinese holiday and will reopen on Tuesday. 
   
  Palm, soy and crude oil prices at 1006 GMT
                                                                                                                                 
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      JUL5    2205   -27.00    2204    2242     538
  MY PALM OIL      AUG5    2219   -17.00    2216    2245    8161
  MY PALM OIL      SEP5    2220   -17.00    2218    2245   13181
  CHINA PALM OLEIN JAN6       0    +0.00       0       0       0
  CHINA SOYOIL     JAN6       0    +0.00       0       0       0
  CBOT SOY OIL     JUL5   32.54    -3.00   32.46   32.66    3148
  INDIA PALM OIL   JUN5  447.20    -3.00  446.80  450.00     475
  INDIA SOYOIL     AUG5  578.75    -3.05  575.20  580.50   34905
  NYMEX CRUDE      JUL5   60.06    +0.45   59.24   60.30    1792
                                                                                                                                 
  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 = 3.7300 ringgit)
 ($1 = 6.2095 Chinese yuan)
 ($1 = 63.54 Indian rupees)
- Reuters