FCPO Related News (Fri, Jan 25)

Crude palm oil futures on Malaysia’s derivatives exchange ended up Wednesday after choppy trade as investors covered positions amid supply concerns. Concerns about tight global vegetable oil supplies brought on by bad weather in soy-growing regions in South America and oil-palm growing areas in Malaysia provided the catalysts for palm oil’s upside, market participants said. The benchmark April contract at Bursa Malaysia Derivatives ended 0.6% higher at 2,481 ringgit a metric ton after moving in a choppy MYR2,450-MYR2,488/ton range. Malaysian markets will be closed Thursday for a public holiday.

CBOT March soyoil was up 0.2% at 52.54 cents a pound by the end of trade on the BMD. "Palm oil is now trading at a hefty discount to rival soyoil. Any weather issues in Latin America will likely drive up soy prices, steering price-conscious importers to palm oil," a vegetable oil exporter in the southern state of Johor said. Refined palm olein is currently offered $300-$350/ton cheaper than rival soyoil from Argentina, physical market data showed.

Tight  global  soy  supplies  and  expectations  for  palm  oil  demand  to  improve in  the  coming  months may   help   reduce   record   high   stockpiles   in   Malaysia , the  world’s  no.  2  producer, and  underpin  prices. Palm  oil  stocks  hit  an  all-time  high  of  2.63  million  tons  at  end-December , according  to   a   Jan. 10  crop  report  by  industry  regulator  the  Malaysian  Palm  Oil  Board.  Cash   CPO   for    prompt  shipment  was  offered  at  MYR2,350/ton. Open  interest   on   the   BMD   was   181,117   lots,   versus  176,684  lots Tuesday. One lot is equivalent to 25 tons. A total of 50,452 lots of CPO were traded versus 35,955 lots Tuesday.           [Dow Jones Newswire]

Today’s Support and Resistance for benchmark April contract is located around 2,439 and 2,483 respectively.