Malaysian palm oil ends little changed

Malaysian palm oil futures made a little headway on Wednesday as firmer crude oil played tug-of-war with expectations of slower demand and improving production for this month. The benchmark June contract on the Bursa Malaysia Derivatives Exchange fell 3 ringgit or 0.12 percent to 2,528 ringgit ($790) per tonne. Traded volume was just 10,596 lots of 25 tonnes each.
The market traded in a narrow range as players awaited fresh leads from cargo surveyors who are due on Thursday to unveil export numbers for the first 15 days of April. Malaysia's March palm oil stocks dropped to six-month lows as overseas demand outweighed a strong production recovery.
But traders said stocks will be higher again in April as palm oil yields improved while the drier weather from El Nino weather condition appeared to ease. Cargo surveyors Intertek Testing Service and Societe Generale de Surveillance, who will unveil Malaysia's palm oil export data for April 1-15, earlier flagged a 30 percent drop in palm oil exports for the first ten days of this month.
The higher ringgit against the US dollar also pressured palm oil prices. It rose 0.6 percent from the previous session to trade at 3.199 ringgit per dollar on Wednesday. A stronger ringgit chews into refiners' margins, as the crude palm oil feedstock for refined products is priced in the Malaysian currency.
"If ringgit continues to get stronger, there is a possibility for the market to break 2,500 ringgit level again," another trader in Kuala Lumpur said. Oil rose to trade near $85 a barrel in Asian hours and supported other vegetable oil markets. Both US soyoil for May delivery and the most-active September soyoil contract on China's Dalian Commodity Exchange inched up.
INDONESIA PALM TRADES Jakarta-based PT KBN Nusantara, formerly known as the state marketing centre, sold 7,000 tonnes of crude palm oil in an auction at a top price of 7,350 rupiah ($0.816) per kg, against 7,343 rupiah per kg in the previous day.
Producers in Medan, home to Indonesia's main palm oil export port of Belawan, did not hold any palm oil tenders on Monday. Refiners in Jakarta offered refined, bleached, deodorised (RBD) palm olein - used as cooking oil - at 7,775 rupiah per kg, against 7,850 rupiah per kg on Tuesday.