Palm oil lower

Malaysian palm oil futures ended lower on Thursday on the prospect of another month of strong crude palm production in the world's second-largest grower, although hopes for firm export demand provided some support. The Malaysian Palm Oil Association, a group of growers, forecast that output rose 17 percent from April 1-20 compared with the same period a month before. In March, Malaysian output surged 33.3 percent to 1.49 million tonnes, the biggest ever month-on-month rise.
The growers' forecast reflects the tropical plant's seasonal output cycle, with supplies normally rising between April and June, traders say. "Moving into April onwards, everyone knows the production will pick up. The inclination for prices to go down is there," said a trader with a foreign commodities brokerage in Kuala Lumpur. "But we also saw some buying interest in April. We are waiting for the 25-days exports to get more leads on where prices need to go." Cargo surveyor Intertek Testing Services will release data on Malaysia's April 1-25 exports on Saturday.
The benchmark July contract on the Bursa Malaysia Derivatives exchange closed at 2,159 ringgit ($596) a tonne on Thursday, slightly lower from 2,160 ringgit in the previous session. Prices were choppy between 2,136 and 2,164 ringgit. Total traded volume stood at 42,451 lots of 25 tonnes, above the usual 35,000 lots. Technicals show that palm oil may retest support at 2,145 ringgit per tonne, as indicated by a rising wedge and a Fibonacci retracement analysis, Reuters market analyst Wang Tao said.
Elsewhere, industry analysts say farmers in China could slash the amount of land they use to grow soybeans by as much as 15 percent in 2015/16 due to uncertainty over how a new subsidy scheme will work. A sixth straight drop in acreage could boost edible oil imports by China, the world's biggest soybean buyer, and a major customer for palm oil. The US July soyoil contract rose 0.5 percent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodity Exchange gained 0.2 percent.