FCPO Related News (Fri, Mar 15)

[Malaysia Mar 1-15 Palm Oil Exports, 675,210 Tons - ITS, up 0.2 %. Malaysia maintains April Crude Palm Oil Export Tax at 4.5% ]

SINGAPORE, March 14 (Reuters) - Malaysian palm oil futures fell to a two-month low on Thursday, dropping for a third straight session on persistent weakness in soy markets, while traders watch for upcoming export data to gauge demand. U.S. soybean prices have been pressured by poor exports and increased competition from South American supplies as traders said Brazilian beans were now being offered at competitive prices. Palm oil investors are still counting on a seasonal drop-off in production that could ease stocks and support prices. Palm oil tends to track soybean oil prices closely as they are substitutes for each other.

The benchmark May contract on the Bursa Malaysia Derivatives Exchange had slid 1.3 percent to 2,366 ringgit ($760) per tonne, just above its intraday low of 2,360 ringgit, the lowest level since Jan. 14. Technical analysis indicates palm oil is expected to fall to 2,333 ringgit per tonne, said Reuters market analyst Wang Tao.

Cargo surveyor Intertek Testing Services said Malaysia's export demand for the March 1-10 period was almost flat with a month ago, while another cargo surveyor, Societe Generale de Surveillance, reported a slight 2.2 percent increase for the same period. Palm oil prices may face further pressure as traders said significantly lower crude palm oil shipments and record high

stocks at destination ports may weigh on exports for the rest of the month.       

   

In other markets, Brent crude held steady below $109 a barrel on Thursday on concerns over demand growth from top two consumers China and the United States, while a firm dollar added pressure on prices. The most-active September soybean oil contract on the Dalian Commodities Exchange had lost 0.7 percent.          [Reuters]

The looming soybean harvest from Brazil–which is set to surpass the U.S. as the world’s biggest producer, at a time when export demand for U.S. soy is weak–weighed on CBOT soy prices. CBOT May soyoil was down 0.7% at 49.19 cents a pound by the end of trade on BMD. "Aside from the supply-side issues, investors are concerned about export demand from Malaysia. Many expect overall shipments to remain weak, as the tax rate came into effect earlier this month," a trading executive at a Kuala Lumpur-based brokerage said.

Three trading executives said separately that palm oil shipments during the March 1-15 period probably reached 665,000 tons, little changed from a month earlier. Both cargo surveyors Intertek Agri Services and SGS (Malaysia) Bhd. will issue shipment data for the period Friday. "Export demand is anemic, so stockpiles aren’t likely to retreat much at the end of March," a Singapore-based physical market broker said. Stockpiles in Malaysia, the world’s no. 2 producer, rose to a record 2.63 million tons in December, before reserves eased to 2.44 million tons at end-February, according to a March 11 report by the Malaysian Palm Oil Board, the industry regulator. Investors are also awaiting the April export tax rate, scheduled to be announced Friday.

Open interest on the BMD was 163,195 lots, versus 160,370 lots Wednesday. One lot is equivalent to 25 tons. A total of 29,364 lots of CPO were traded versus 31,784 lots Wednesday.      

[Dow Jones Newswire]

Today’s Support and Resistance for benchmark  May contract is located around 2,360 and 2,420 respectively.