Malaysian palm oil futures fell on Monday to their lowest in over three weeks despite supportive government data, weighed down by plunging crude oil prices and volatile global equities
KUALA LUMPUR: Malaysian palm oil futures rose to a near three-month high on Monday, as a weaker ringgit and concerns that drier weather could curb output boosted prices.
The benchmark palm oil contract for March on the Bursa Malaysia Derivatives Exchange ended 1.6 percent higher at 2,441 ringgit ($568.07) a tonne. It earlier touched 2,457 ringgit, its highest since Sept. 29.
Traded volume stood at 35,603 lots of 25 tonnes each at the end of the trading day.
"There's a lot of people factoring in the weather," said a Kuala
Lumpur-based trader, referring to an El Nino weather event which brings dry
conditions to Southeast Asia and lowers palm's productivity.
"We will see its effects in the second quarter (of 2016). The year-end
monsoon season isn't affecting palm too much at the moment, we aren't seeing too
much rain."
A key monthly indicator for El Nino has reached a level not seen since 1997,
according to the U.S. weather agency.
Leading analysts earlier forecast that lower output as a result of the dry
weather will boost palm prices next year.
The ringgit, the currency palm is traded in, fell 0.2 percent against
the dollar on Monday, lending some support to palm. A weakening ringgit usually
boosts palm prices as it makes the tropical oil cheaper for holders of foreign
currencies.
High production and low exports have been keeping palm trading rangebound in
recent weeks. Palm shipments from two cargo surveyors showed on Monday a near 25
percent drop in exports from December 1-20 compared with the same time a month
ago.
In competing vegetable oil markets, the U.S. January soyoil contract
rose 0.9 percent, while the May soybean oil contract on the Dalian
Commodity Exchange gained 1.9 percent.
Palm, soy and crude oil prices at 1016 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JAN6 2273 +37.00 2250 2280 168
MY PALM OIL FEB6 2375 +44.00 2344 2392 3609
MY PALM OIL MAR6 2441 +39.00 2411 2457 20364
CHINA PALM OLEIN MAY6 4696 +150.00 4548 4696 1192204
CHINA SOYOIL MAY6 5620 +106.00 5530 5622 825378
CBOT SOY OIL JAN6 30.80 +6.50 30.35 30.95 4950
INDIA PALM OIL DEC5 401.80 +6.50 397.00 402.90 1588
INDIA SOYOIL JAN6 623.85 +6.40 620.00 624.70 35370
NYMEX CRUDE JAN6 34.50 -0.23 34.31 34.72 1130
($1 = 4.2970 ringgit)
($1 = 66.3100 Indian rupees)
($1 = 6.4793 Chinese yuan)
- Reuters
Limited time offer:
Just RM5 per month.
