Monday, May 24, 2010

DJ Asian Crude Palm Oil Ends Down Marginally; Export Data Due Tuesday

KUALA LUMPUR (Dow Jones)--Crude palm oil futures on Malaysia's derivatives exchange ended marginally lower in choppy trade Monday as investors liquidated positions ahead of the release of export statistics.

The benchmark August contract on the Bursa Malaysia Derivatives exchange ended MYR1 lower at MYR2,490 a metric ton after moving in a MYR2,481-MYR2,498 range.

Higher crude oil and soyoil prices boosted prices in early trade, but speculation that palm oil output has risen in May prevented palm futures from climbing above MYR2,500/ton, trade participants said.

"The market has been directionless today and most traders have opted to liquidate their positions until there's a clearer direction in the market," said an executive at Kuala Lumpur-based commodities brokerage.

Some trade participants said CPO output in May has risen around 5%-6% so far this month, damping market sentiment with expectations that end-month palm oil inventory levels could also rise.

Investors ignored talk that palm oil exports were also likely to rise in the May 1-25 period, focusing instead on palm oil's supply fundamentals.

"Palm oil exports may have risen to around 1.03 million tons (for the May 1-25 period)," said a senior trading executive at Malaysia-based plantation company.

The loading of the vessels seems to have been fairly active in some ports in east Malaysia, a Malaysia-based shipping executive said.

Exports totaled 947,304 tons for the first 25 days in April, according to data from cargo surveyor Intertek Agri Services. Another independent surveyor SGS (Malaysia) Bhd. put exports in the period at 1.01 million tons.

Both surveyors are likely to issue estimates of exports for the corresponding period of May on Tuesday.

Prices may rise above MYR2,500/ton on Tuesday if exports meet market expectations, a Singapore-based analyst said.

Sluggish demand in the physical market also limited any rise in prices today, a Singapore-based cash market broker said.

Palm olein for October/November/December was traded at $780/ton free on board from Malaysian ports, a Singapore-based trader said.

Cash CPO for prompt shipment was offered MYR10 higher at MYR2,570/ton. Open interest on the BMD was 69,048 lots, versus 68,244 lots Friday. One lot is equivalent to 25 tons.

A total of 6,019 lots of CPO were traded versus 12,806 lots Friday. 
Closing BMD CPO futures prices in MYR/ton at 1000 GMT: 
Month   Close  Previous  Change   High    Low 
Jun'10  2,530     2,531  Down 01  2,545   2,530 
Jul'10  2,508     2,511  Down 03  2,520   2,501 
Aug'10  2,490     2,491  Down 01  2,498   2,481 
Sep'10  2,472     2,480  Down 08  2,480   2,467 
  -By Shie-Lynn Lim, Dow Jones Newswires; +603 2026 1233; 

DJ MARKET TALK: BMD CPO Futures May Open MYR5-MYR10 Lower

[Dow Jones] BMD CPO futures expected to open MYR5-MYR10 lower, tracking Friday's fall in crude oil futures, traders say. Investors likely to take profit after recent rise in prices, says executive at Kuala Lumpur-based commodities brokerage; adds prices likely stay in negative territory in early trade. Market may move in MYR2,480-MYR2,510/ton range, analyst in Malaysia says; benchmark August contract ended MYR15 higher Friday at MYR2,491/ton. ( Call us in Kuala Lumpur: +(603) 2026 1233