KUALA LUMPUR (April 5): Malaysian palm oil futures hit a fresh one-month top on Thursday, charting a fourth session of gains in five, as expectations of falling end-March stockpiles boosted the market.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange rose 0.7% to 2,472 ringgit US$639.59) a tonne at the end of the trading day.
It earlier rose to 2,478 ringgit a tonne, its highest since March 7.
Trading volume stood at 26,381 lots of 25 tonnes each at the close of trade.
“The market is looking at end-stocks reducing,” a Kuala Lumpur-based trader said, referring to Malaysian inventory levels at the end of March.
Another trader said news of China’s increase in tariffs by up to 25% on 128 U.S. products, including soybeans also lent support to the market.
China’s move to impose tariffs on imported U.S. soybeans may boost palm oil’s draw in the short term, traders and analysts said, as the spread between palm and soyoil is expected to widen as the latter becomes more costly in Beijing.
Palm oil stocks in Malaysia, the world’s second largest producer of the tropical oil, are expected to have slipped to their lowest in five months, down 8.6% from February to 2.27 million tonnes, according to a Reuters poll on Thursday.
The survey also showed exports to have risen to the highest in over a year and a half at 1.57 million tonnes, up 19.3% from February. Meanwhile, production is seen up 11.3% to 1.49 million tonnes in March, its first monthly gain in five.
Official data will be released by industry regulator, the Malaysian Palm Oil Board (MPOB), on April 10.
In related oils, the Chicago Board of Trade’s May soybean oil contract was up 0.3%.
China’s Dalian Commodity Exchange is closed on Thursday for a national holiday.
Palm oil prices are impacted by movements in rival edible oils, as they compete for a share in the global vegetable oils market.
Palm oil may rise to a range of 2,471-2,498 ringgit per tonne, according to Reuters market analyst for commodities and energy technicals Wang Tao.
Palm, soy and crude oil prices as of 1038 GMT
Contract Month Last Change Low High Volume
MY PALM OIL APR8 2445 +14.00 2440 2445 40
MY PALM OIL MAY8 2469 +14.00 2445 2479 2000
MY PALM OIL JUN8 2468 +18.00 2455 2478 14277
CHINA PALM OLEIN SEP8 0 +0.00 0 0 0
CHINA SOYOIL SEP8 0 +0.00 0 0 0
CBOT SOY OIL MAY8 31.78 +0.10 31.68 31.82 4072
INDIA PALM OIL APR8 654.70 +1.80 652.50 655.3 1076
INDIA SOYOIL APR8 780.4 +0.70 778.2 781.8 6440
NYMEX CRUDE MAY8 63.21 -0.16 63.19 63.79 109365
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel
(US$1 = 3.8650 ringgit)
(US$1 = 65.0175 Indian rupees)
(US$1 = 6.3045 Chinese yuan)