FCPO Related News

Crude palm oil futures on Malaysia’s derivatives exchange ended lower Monday as traders refrained from making aggressive bets ahead of vegoil price outlooks by leading analysts. The benchmark December contract at Bursa Malaysia Derivatives ended 2.7% lower at 2,433 ringgit a metric ton after moving in a MYR2,417-MYR2,475 range. Investors also liquidated riskier positions amid lower Chicago soyoil futures during Asian hours and the possibility of large new soybean crops in Argentina and Brazil.

"The new export duty announced by the Malaysian government is a better option than the tax range of 8%-10% mentioned previously," a commodities trader in Kuala Lumpur said. However, I’m not going to take a big risk and I’ve liquidated most of my positions, given the still ample palm oil supplies and price outlooks Tuesday," the trader said. Leading vegetable oils analyst Dorab Mistry, Hamburg-based oilseed analyst Thomas Mielke and London-based James Fry, chairman of agri-consultancy LMC International, are scheduled to present their price outlooks at an industry seminar in Kuala Lumpur Tuesday.

Malaysia, the world’s biggest palm oil producer after Indonesia, said late last week that it will abolish a duty-free CPO export quota from 2013 and introduce a graduated export tax system to ensure sufficient domestic CPO supplies over the long term and lower feedstock costs, helping Malaysian downstream palm oil processors grab back market share from Indonesia. "We are of the opinion that the sliding scale for the export duty makes sense, as it will encourage more CPO exports if prices are low, thus helping to keep the ballooning inventory in check," OSK Investment Bank said in a note.

[Dow Jones Newswire]

Malaysia  may continue issuing a tax free crude palm oil quota to some firms next year, a senior industry source told Reuters on Monday, as planters resist the government plan to abolish the export facility in the world's No.2 producer of the edible oil. The market expects top industry analysts Dorab Mistry, Thomas Mielke and James Fry to address the impact of the tax change at a seminar in Malaysia on Tuesday.

Latest cargo surveyor data pointing to stronger demand could help ease palm oil stocks in Malaysia, which hit a record 2.48 million tonnes in September. Exports of Malaysian palm oil products for Oct. 1-15 rose 13.1 percent to 769,534 tonnes from 680,112 tonnes for the Sept. 1-15 period, Intertek Testing Services said on Monday. Another cargo surveyor, Societe Generale de Surveillance, reported a higher increase of 16.3 percent on the month, to 768,550 tonnes.

Technicals showed palm oil would fall to 2,361 ringgit per tonne, as a rebound from 2,230 ringgit has finished around resistance at 2,528 ringgit, said Reuters analyst Wang Tao. In a bearish sign for palm oil, Brent futures slipped towards $114 a barrel on Monday, falling for a second session due to worries over weak oil demand, although concerns over potential supply risks from tension in the Middle East kept losses in check.

[Reuters]

India, the world's top vegetable oil importer, will buy more crude palm oil from Malaysia next year after the world's no. 2 producer said it will scrap an existing quota on duty-free exports and reduce export taxes on CPO from January, B.V. Mehta, executive director at the Solvent Extractors' Association of India, said Monday. "It has always been the Indian government's policy to import more CPO. The new export tax structure [announced by Malaysia] makes it cheaper for India to buy CPO from Malaysia, instead of Indonesia," Mr. Mehta said on the sidelines of an industry briefing. India is expected to buy 7.5 million metric tons of palm oil this year, with CPO cargoes accounting for some 6.5 million tons, he added.
Malaysia Friday said it would reduce the export tax on CPO from 23% to a graduated basis from Jan. 1, which will reduce the gap between the taxes on CPO and refined oil, which hasn't been taxed for the past three decades as Southeast Asia's third-largest economy built up its domestic palm oil processing industry.