FCPO Related News (Mon, Dec 17)

Crude palm-oil futures on Malaysia’s derivatives exchange rose Friday as some investors covered short positions after palm oil prices tumbled to a three-year low Thursday. The benchmark February contract at Bursa Malaysia Derivatives settled 2% higher at 2,275 ringgit (US$744) a metric ton after trading in a MYR2,232-MYR2,285/ton range. CPO prices registered a low of MYR2,217/ton Thursday, the lowest since mid-November 2009.

Bullish economic data from China on Friday morning spurred hopes of a rebound in the world’s second-largest economy and also incited investors to pour into the market, underpinning CPO prices, market participants said. HSBC’s preliminary purchasing managers index hit a 14-month high of 50.9 in December, compared with a final reading of 50.5 for November. This indicates that China’s appetite for commodities is sustainable, and continued demand for vegetable oils such as palm oil could help ease concerns about Malaysia’s rising palm oil inventories, which hit a record high at the end of November, a Kuala Lumpur-based trader said.

Meanwhile, Malaysia’s export tax for January, likely to be revealed Monday, is expected to be close to zero and should stimulate demand for palm oil, boosting shipments from the world’s second-largest palm oil producer, a Kuala Lumpur-based trading executive said. CPO prices could edge upward if exports rise, they said. Open interest on the BMD was 197,356 lots, versus 185,512 lots Thursday. One lot is equivalent to 25 tons. A total of 44,840 lots of CPO were traded versus 34,576 lots Thursday.           [Dow Jones Newswire]

Malaysia Dec 1-15 Palm Oil Exports 719,817 tons, down 6.4% on month – Intertek.

Today’s Support and Resistance for benchmark March contract is located around 2,320 and 2,390 respectively.