Malaysian crude palm oil futures closed almost half a percent lower on Monday on weaker overseas demand but weather concerns in key soy-growing regions limited losses. Traders were concerned that strong demand was tapering off when cargo surveyors reported up to 16.4 percent decline in Malaysian palm oil exports for August 1-15.
The benchmark November crude palm oil futures ended 0.45 percent, or 12 ringgit, lower at 2,678 ringgit ($845.8) per tonne. Overall traded volume more than doubled to 24,510 lots of 25 tonnes each. "It's a good excuse for the market to take profit from the (cargo surveyors) report, but supportive factors including strong trading of soybean, soyaoil, rapeseed are still intact," said a trader with foreign brokerage in Kuala Lumpur.
A forecaster said hot and dry weather in the southern US Midwest and Delta regions this week is likely to stress the soy crop in its critical pod-filling stage, raising fears of yield losses and lifting Asian vegetable oil markets.
But one Malaysian trader said prospects for overseas demand were still bright. "Last month the exports were a bit high, above 1.4 million tonnes, so there will be a drawdown this month. We wouldn't rule out that exports will still be above 1.25 to 1.35 million tonnes," said a trader in Kuala Lumpur. Crude oil edged higher towards $76 a barrel on Monday, boosted by a weaker dollar, but concerns about faltering economic recovery in some big oil consuming nations capped gains.
In Asian hours September soyaoil on the Chicago Board of Trade fell, while the most-active May soyaoil contract on China's Dalian Commodity exchange rose 0.5 percent in heavy trading. Chinese traders took positions on concerns over weather in soybean planting regions and record high soybean imports. "Funds are bidding on soyaoil now as many external factors are moving the market. China's palm oil market followed firmer soyaoil since Ramazan buying is almost done," said a trader in Shanghai.
INDONESIA PALM TRADES: In Indonesia, Jakarta-based PT KBN Nusantara, formerly known as the state marketing centre, sold 7,000 tonnes of crude palm oil in an auction on Monday with top price at 8,310 rupiah ($0.927) per kg, against 8,212 rupiah a kg on Friday. There was no auction in Medan, home to Indonesia's main palm oil export port of Belawan on Monday. Refiners in Jakarta offered refined, bleached, deodorised (RBD) palm olein - used as cooking oil - at 8,700 rupiah per kg on Monday against 8,600 rupiah per kg on Friday. Indonesian palm oil markets will be closed on Tuesday for a national holiday.
Comments
Comments are closed.