Palm oil futures down

Malaysian palm oil futures inched lower on Wednesday in rangebound trading, as traders watched for further clues from upcoming industry data and avoided taking risky positions ahead of next week's Lunar New Year holidays. Concern that dry weather in South America could hurt soy crops has also eased after forecasts pointing to rains in parts of Argentina's grain belt this month.
"A lot of people are evening out positions ahead of the long holiday. There's no lead in the market, it's going to be rangebound," said a trader with a foreign commodities brokerage in Malaysia. Malaysian financial markets will be closed next Monday and Tuesday for the Lunar New Year holiday, while China's financial markets will take a week-long break.
At market close, the benchmark April contract on the Bursa Malaysia Derivatives Exchange had edged down 0.2 percent to 2,542 ringgit ($821) per tonne. Prices traded in a tight range of 2,529 to 2,553 ringgit. Total traded volumes stood at 29,055 lots of 25 tonnes each, compared to the average 25,000 tonnes. Technical analysis shows a bearish target at 2,510 ringgit remains unchanged, as indicated by its wave pattern and a Fibonacci retracement analysis, said Reuters market analyst Wang Tao.
Markets will be eyeing January stocks data from industry regulator the Malaysian Palm Oil Board due on February 13. Malaysia's palm stocks hit a record 2.63 million tonnes in December. "Even if January stocks go down, the drop should not be significant. Stocks are still going to be high," added the Malaysian trader. Investors are also awaiting this Friday's US Department of Agriculture monthly supply and demand reports, which are expected to show tighter US and global soybean stocks. Lower output of soybean and soybean oil may shift more vegetable oil demand to competing palm oil. In competing vegetable oil markets, US soyaoil for March delivery eased 0.7 percent in late Asian trade. The most active September soyabean oil contract on the Dalian Commodity Exchange also closed lower.