Wednesday, 3 April 2013
FCPO Related News (Thurs, Apr 4)
Palm oil futures on Malaysia’s derivatives exchange end higher after choppy trade, tracking soyoil gains on the Dalian Commodity Exchange as investors cover positions ahead of a two-day holiday in China, says a senior dealer at a brokerage in Kuala Lumpur; tips palm oil to trade in a range of MYR2,350/ton to MYR2,420/ton for the rest of the week in the absence of any fresh catalysts. [Dow Jones Newswire]
SINGAPORE, April 3 (Reuters) - Malaysian palm oil futures ended higher on Wednesday as expectations of lower palm oil stocks offset weak overseas soy markets. Soybean prices have lost 1 percent so far this week and could face further pressure as port congestion in Brazil started to ease and the country's shipments are likely to increase in coming weeks, Hamburg-based oilseeds analysts Oil World said. A higher supply of soybeans to be crushed into vegetable oil could shift some demand away from competing palm oil.
But market participants remain hopeful for prices to be supported by an easing in Malaysia's March palm oil inventory, following lower production and improving export data. By market close, the benchmark June contract on the Bursa Malaysia Derivatives Exchange had edged up 0.6 percent to 2,396 ringgit ($778) per tonne. Prices fell as low as 2,335 ringgit on Monday, the lowest in almost three months. "The market should still be trading in a range between 2,350 and 2,400 ringgit. Today it opened lower because of the weaker soy markets," said a trader with a foreign commodities brokerage in Malaysia. "On the local front it's still supportive, as production and stocks are expected to be lower."
Total traded volume stood at 31,672 lots of 25 tonnes each, slightly lower than the average 35,000 lots seen this year. Technical analysis showed palm oil is expected to revisit its Monday low of 2,335 ringgit, as it may have completed a rebound from this level, said Reuters market analyst Wang Tao. Cargo surveyor data showed better exports in March than February, marking the first monthly rise in four months, boosted by higher shipments of refined products. Malaysia's stock market lost more than 3 percent in early Wednesday trade following Prime Minister Najib Razak's announcement that paved the way for a long-anticipated general election, but traders said it should not have the same impact on palm oil futures.
In other markets, Brent crude oil slid towards $110 a barrel on Wednesday as oil stockpiles swelled in top oil consumer the United States, where a struggling economy is limiting demand for fuel. In vegetable oil markets, U.S. soyoil for May delivery edged up 0.1 percent in early Asian trade. The most active September soybean oil contract on the Dalian Commodities Exchange inched up 0.2 percent. [Reuters]
Today’s Support and Resistance for benchmark June contract is located around 2,360 and 2,400 respectively.