Malaysian palm oil futures edged up on Wednesday to their highest in more than a week, tracking other vegetable oil markets, although gains were limited by record stockpiles. Malaysia's palm oil stocks in September surged 17.4 percent from a month ago to a record 2.48 million tonnes on strong production, the Malaysian Palm Oil Board said after the midday break.
The rise in stocks exceeded market expectations of 2.46 million tonnes, paring gains that had earlier sent futures to an intraday high at 2,483 ringgit, a level last seen on October 1. Prices fell to a near 3-year low last week but have since been recovering steadily on bargain-hunting and prospects of a cut in export tax by the Malaysian government. "The market is still rangebound, trading between 2,400 and 2,500 ringgit," said a trader with a foreign commodities brokerage in Malaysia.
The benchmark December contract on the Bursa Malaysia Derivatives Exchange had edged up 0.8 percent to close at 2,457 ringgit ($800) per tonne. Total traded volumes stood at 45,198 lots of 25 tonnes each, much higher than the usual 25,000 lots. Malaysia's palm oil exports for October 1-10 fell 1 percent to 448,624 tonnes from a month ago, cargo surveyor Intertek Testing Services said on Wednesday.
Another cargo surveyor, Societe Generale de Surveillance, reported a steeper 8.7 percent decline for the same period, but traders say shipments could pick up later in the month. Technical analysis showed palm oil was expected to end its current rebound around a resistance at 2,503 ringgit per tonne, and fall towards 2,230 ringgit, said Reuters market analyst Wang Tao. Palm oil prices were also supported by gains in other vegetable oil markets. By 1010 GMT, US soyaoil for December delivery was up 0.4 percent. The most active January 2013 soybean oil contract on the Dalian Commodity Exchange ended the day 0.7 percent higher.