Thursday, 7 November 2013

FCPO Related News (Fri, Nov 8)

KUALA LUMPUR, Nov 7 (Reuters) - Malaysian palm oil futures  fell to a one-week low on Thursday, stretching losses into a third day as investors continued to take profits from last week's steep gains, but prices were stuck in a range ahead of  key output and inventory data. Production in Southeast Asia, which accounts for nearly all of the world's palm oil supply, may have tapered off sooner than expected this year as the monsoon season hampered harvesting.

Investors are eyeing data from Malaysia -- the world's No.2 producer -- on palm oil stocks, exports and output in October that will be released by industry regulator the Malaysian Palm Oil Board on Nov. 11. "The market is quiet. Prices are moving in a 2,550-2,600 ringgit range as investors wait for new leads," said a trader with a foreign commodities brokerage. A Reuters survey showed that Malaysian palm oil stocks probably inched up to 1.82 million tonnes in October, with the increase in inventories limited by lower output of the tropical oil that was predicted to have dropped by 3.3 percent.  

By Thursday's close, the benchmark January contract on the Bursa Malaysia Derivatives Exchange had edged down 0.2 percent to 2,543 ringgit ($800) per tonne. Palm oil prices, which traded in a range of 2,525-2,562 ringgit, have shed 3.2 percent so far this week after last week's almost 8 percent gain, the biggest such rise since 2010. Total traded volume stood at 46,772 lots of 25 tonnes each on Thursday, higher than the usual 35,000 lots. Technicals were bearish. Malaysian palm oil is expected to break support at 2,544 ringgit per tonne and fall further towards 2,491 ringgit, Reuters market analyst Wang Tao said.

The price of the tropical oil could however get a boost from prospects of a drop in output and stronger Asian demand. China, the world's second-biggest palm oil buyer, is expected to begin re-stocking the edible oil ahead of its Lunar New Year festival celebrated at the end-January. "We would expect China to increase palm oil imports in the upcoming months, especially after the winter season," said  Phillip Futures analyst Tan Chee Tat in a note on Thursday.

In competing vegetable oil markets, the U.S. soyoil contract for December fell 0.2 percent in late Asian trade. The most-active May soybean oil contract on the Dalian Commodities Exchange fell 0.3 percent.

In other markets, Brent crude fell below $105 a barrel to  its lowest since early July as plentiful supplies and continued  progress in talks between Iran and the West over Tehran's disputed nuclear programme weighed on prices.

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