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VEGOILS-Palm oil down, upbeat demand outlook caps losses
March 20, 2012 / 6:02 AM / 6 years ago

VEGOILS-Palm oil down, upbeat demand outlook caps losses

* Palm oil to test resistance at 3,398 ringgit -technicals
    * Malaysian exports for March 1-20 up 14.2 pct

 (Updates prices, adds SGS export data)	
    By Chew Yee Kiat	
    SINGAPORE, March 20 (Reuters) - Malaysian palm oil futures
extended losses on Tuesday as some traders took profits on
concerns that the market was overbought, although losses were
limited by still-robust demand as indicated by export trends.	
    Palm oil rallied to a 9-month high of 3,418 ringgit last
Friday on an upbeat price outlook, and traders said the market
was poised for a correction.	
    "Prices ended lower in unison with CBOT and technical-based
selling. It looks like the much anticipated correction is taking
place currently and once that is completed, prices will resume
their uptrend," said a trader with a local brokerage in
Malaysia.	
    Benchmark June palm oil futures on the Bursa
Malaysia Derivatives Exchange lost 0.2 percent to close at 3,366
ringgit ($1,093) per tonne, paring gains this year to 6 percent
from a year-high 7.2 percent. 	
    Traded volumes on Tuesday stood at 28,255 lots of 25 tonnes
each, higher than the usual 25,000 lots.	
    Palm oil faces a support at 3,343 ringgit per tonne and will
rise to test resistance at 3,398 ringgit, said Reuters market
analyst Wang Tao. 	
    Cargo surveyors Intertek Testing Services and Societe
Generale de Surveillance reported a 14 percent increase in
Malaysian exports for the first 20 days of March, indicating
that demand is still strong despite a slowdown compared to the
first 15 days.  	
    Market players are also paying close attention to a strike
by Argentina's truckers to demand higher pay rates just as
exporters were counting on them to haul freshly harvested
soybeans to port. 	
    Traders are looking out for planting forecasts from the U.S.
Department of Agriculture due at the end of the month to help
gauge soybean output for the year. 	
    Lower soybean output means less for crushing into soyoil,
allowing the competing palm oil to meet the shortfall.	
    Brent crude fell towards $124 a barrel as signs of increased
supply from Saudi Arabia and a return to pre-war exports from
Libya eased pressure on the market, while a slowdown in Chinese
demand and a stronger dollar also weighed. 	
    In other vegetable oil markets, the most active U.S. soyoil
contract for May delivery lost 1 percent in Asian trade
while the most active September 2012 soyoil contract on
China's Dalian Commodity exchange edged down 1.3 percent.	
   	
  Palm, soy and crude oil prices at 1004 GMT
                                                                              
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR2    3364    -6.00    3346    3370     398
  MY PALM OIL      MAY2    3371    +3.00    3346    3373    4437
  MY PALM OIL      JUN2    3366    -7.00    3346    3378   15623
  CHINA PALM OLEIN SEP2    8542  -124.00    8536    8644  183290
  CHINA SOYOIL     SEP2    9558  -126.00    9554    9676  493268
  CBOT SOY OIL     MAY2   54.77    -0.62   54.75   55.40   10230
  NYMEX CRUDE      APR2  107.22    -0.87  107.10  107.91    2117
                                                                              
  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
  Crude in U.S. dollars per barrel
   
($1=3.08 ringgit)	
	
 (Editing by Jonathan Hopfner and Niluksi Koswanage)

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