Monday, June 14, 2010

[DJ]DJ Asian Crude Palm Oil Ends Up On Expected Higher Malaysia Exports

  KUALA LUMPUR (Dow Jones)--Crude palm oil futures ended higher on Malaysia's derivatives exchange Monday as market participants expect estimates of Malaysian exports in the first half of June to rise compared with a month ago and in line with other commodity markets.

Malaysia's palm oil exports will be around 650,000-690,000 metric tons in June 1-15 period, according to traders' estimates. That would be higher than the May 1-15 numbers issued a month ago by cargo surveyors Intertek Agri Services and SGS (Malaysia) Bhd..

CPO for August delivery traded at the Bursa Malaysia Derivatives ended 1% higher at MYR2,410/ton after dipping to the benchmark contract's lowest level this year on Friday, at MYR2,396/ton.

Traders expected palm oil prices to stage a small rebound on technical factors Monday, limited by rising inventory levels in Malaysia and Indonesia, both major producers.

Rising inventories and higher CPO output for June in both countries could pressure prices in the next few weeks, they said.

"The much-touted heavy purchases by major buyers for July/August/September hasn't come about so far," said a senior trading executive in Singapore.

Palm olein, which of late has been trading a par with, or at a slight premium to, crude soyoil is losing market share to its rival.

An analyst at a Kuala Lumpur-based brokerage said demand could pick up if palm olein prices fall enough to put them at a wide discount-- around $60-$100/ton--to soyoil, which was the case until early this year.

In the cash market, palm olein for July at $780/ton, free-on-board Malaysian ports, a Singapore-based cash market broker said.

Cash CPO for prompt delivery was offered MYR5 higher at MYR2,540/ton.

CME Group's dollar-based CPO futures for September were offered $1.25 higher at $724.25/ton around 1001 GMT, with no lots traded.

August rupiah-denominated CPO futures on the Indonesia Commodity and Derivative Exchange ended 0.2% higher at IDR6,515 a kilogram with 6 lots traded. One lot is equivalent to 10 tons. The September contract was trading 0.5% higher IDR6,455/kg with 231 lots done.

Open interest on the BMD was 78,541 lots, versus 77,512 lots Friday. One lot is equivalent to 25 tons.

A total of 11,128 lots of CPO were traded versus 19,392 lots Friday.

Closing BMD CPO futures prices in MYR/ton at 1000 GMT:

Month   Close  Previous  Change   High    Low
Jun'10  2,549     2,525  Up  24   2,550  2,549
Jul'10  2,455     2,430  Up  25   2,459  2,442
Aug'10  2,410     2,386  Up  24   2,410  2,390
Sep'10  2,384     2,360  Up  24   2,384  2,367

  By Shie-Lynn Lim, Dow Jones Newswires; +603 2026 1233;

  (END) Dow Jones Newswires
  06-14-10 0658ET
Copyright (c) 2010 Dow Jones & Company, Inc.

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