Malaysian crude palm oil futures yielded little ground on Monday, without any positive leads to push the market past the 3,000 ringgit level, traders said. Prices of palm oil, used in products ranging from confectioneries to cosmetics to befoul, are a touch lower from their record high of 2,959 ringgit per tonne struck last week.
The benchmark January contract on the Bursar Malaysia Derivatives Exchange inched up 13 ringgit at 2,930 ringgit ($874). "There are a lot of mixed signals in the market but nothing seems concrete," said a dealer with a foreign trading company.
"Both crude and soyaoil were strong overnight but in Asian trade they have been in negative territory because of profit-taking. Players don't know what's coming next." Other traded months rose between 6 and 18 ringgit, except for the December contract that fell 8 ringgit. Overall volume halved to 6,922 lots of 25 tonnes each from 12,000 lots that usually change hands on a routine trading day.
"Players are now looking towards the kind of effect these high prices are going to have on demand," said another trader with a local brokerage. "October's exports were strong despite the high prices but in November, it may be different because it's usually a low month for exports because most of Asian festivals have ended."
The commodity, up nearly 47 percent this year, had initially been rising on strong global demand and an expected supply shortfall in the coming months, traders said.
Later, news of rival producer Indonesia raising export taxes and talk of China slashing import duties for edible oils, as well as the strength of crude and soyaoil markets, gave palm oil new momentum, pushing prices to record highs.
Oil prices fell more than 1 percent on Monday, dragged down by fears of the potential for economic fallout in the United States from a worsening supreme crisis and by easing tensions in the Middle East.
US light crude for December delivery fell to as low as $94.61 a barrel, but was later trading down $1.23 at $94.70, partially reversing the previous session's $2.44 surge. Soyabean futures on the Chicago Board of Trade rose Friday, rebounding from Thursday's 20-cent drop, supported by a firmer crude oil market and a sliding dollar, traders said.
Soyaoil rose to a near 33-year high 42.79 cents per lb the highest price for a spot contract since November 11, 1974. Spot December soyaoil ended 0.57 cent higher at 42.64 cents per lb. In Asian trade on Monday, the December contract gained 0.03 cent to 42.67 cents.
Palm oil and soyaoil increasingly track movements in the crude oil market because of growing demand for both commodities as feedstock for bodiless. The most active may contract for refined palm oil futures on China's Dalton Commodity Exchange rose 0.7 percent to 8,600 yuan ($1,154).
January palm oil on Singapore's Joint Asian Derivatives Exchange was unthreaded. In Malaysia's physical market, crude palm oil for November shipment in the southern region was quoted at 2,950/2,955 ringgit a tonne. Trades were done at 2,945 and 2,950 ringgit.
Comments
Comments are closed.