November 9, 2017 / 5:06 AM / 9 months ago

VEGOILS-Palm climbs on stronger crude oil, year-end output concerns

    * Palm climbs to one-week top of 2,835 rgt/T
    * Seasonal production drawdown in Nov/Dec supportive of
market -
    * Palm may revisit Oct 30 high of 2,855 rgt/T - Technicals
    * Official data scheduled for release on Friday after 0430

    By Emily Chow
    KUALA LUMPUR, Nov 9 (Reuters) - Malaysian palm oil futures
climbed to their highest in a week on Thursday, in line for a
third straight session of gains, tracking strength in crude oil
    The benchmark palm oil contract for January delivery
 on the Bursa Malaysia Derivatives Exchange was up 0.3
percent at 2,827 ringgit ($668.80) a tonne at the midday break. 
    Earlier in the session, it rose to 2,835 ringgit, its
strongest since Nov. 2.
    Traded volumes stood at 15,115 lots of 25 tonnes each at
    "Crude oil prices are up. Palm oil to gasoil spread is at a
low, resulting in energy companies buying palm and selling
gasoil," said a palm oil futures trader.  
    "An expected, seasonal production drawdown in November and
December is also a catalyst for higher price levels," he added.
    Crude oil prices held steady on Thursday supported by
ongoing supply cuts led by Russia and the Organization of the
Petroleum Exporting Countries (OPEC). It hit its highest since
July 2015 earlier this week on an anti-corruption crackdown in
oil producer nation Saudia Arabia.
    Palm prices are affected by movements in the crude oil
market as the edible oil is used as feedstock to make biodiesel,
a fuel substitute. 
    The spread or price difference between palm oil and gas oil
was last at $105, versus over $120 last week. 
    Palm oil production is seen to decline in the last two
months of the year, after a surge in October. 
    October output is seen rising on-month by 9.4 percent to
1.95 million tonnes, according to a Reuters survey.
    Official data from industry regulator Malaysian Palm Oil
Board is scheduled for release on Friday.  
    In other related oils, the December soybean oil contract
 on the Chicago Board of Trade dipped as much as 0.2
percent, while the January soybean oil contract on the Dalian
Commodity Exchange was up 0.1 percent.
    The January palm olein contract on Dalian rose 1.1
    Palm oil is impacted by other edible oils as they compete
for a share of the global vegetable oils market. 
    Palm may revisit its Oct. 30 high of 2,855 ringgit per
tonne, said Wang Tao, a Reuters market analyst for commodities
and energy technicals.   
    Palm, soy and crude oil prices at 0444 GMT
 Contract          Month    Last  Change     Low    High  Volume
 MY PALM OIL       NOV7        0   +0.00       0       0       0
 MY PALM OIL       DEC7     2807   +8.00    2802    2813     229
 MY PALM OIL       JAN8     2827   +7.00    2823    2835    7085
 CHINA PALM OLEIN  JAN8     5688  +64.00    5632    5712  262532
 CHINA SOYOIL      JAN8     6136   +4.00    6114    6168  224160
 CBOT SOY OIL      DEC7    35.31   -0.06   35.29   35.44    6090
 INDIA PALM OIL    NOV7   567.30   -1.70  565.00   568.4     148
 INDIA SOYOIL      NOV7    702.4   -2.70     701   702.4     210
 NYMEX CRUDE       DEC7    56.88   +0.07   56.82   56.98   11794
 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
($1 = 4.2270 ringgit)
($1 = 64.8900 Indian rupees)
($1 = 6.6306 Chinese yuan)

 (Reporting by Emily Chow; Editing by Sherry Jacob-Phillips)
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