March 13, 2018 / 5:15 AM / 3 months ago

VEGOILS-Palm gains on stronger rival oils, improved demand

    * Palm in line for 2nd straight day of gains
    * Market gains not sustainable as output rises -trader
    * Palm oil may bounce into 2,403-2420 rgt/T range
-technicals

    By Emily Chow
    KUALA LUMPUR, March 13 (Reuters) - Malaysian palm oil
futures rose on Tuesday, lifted by strength in rival edible oils
and as demand expectations improved, according to traders based
in Kuala Lumpur. 
    "We're seeing a bit of bargain-buying ... Exports could
improve as buyers rush to take advantage of Malaysia's tax
suspension," said a Kuala Lumpur-based futures trader, referring
to a three-month palm oil export tax suspension expected to
increase demand and boost prices. 
    The Malaysian government introduced the move in early
January. The zero tax is set to end on April 7.
    The gains may not be sustainable, though, as production in
March is expected to rise, said the trader. 
    "Production is set to recover strongly," he said.     
    The benchmark palm oil contract for May delivery
on the Bursa Malaysia Derivatives Exchange was up 0.5 percent at
2,392 ringgit ($612.55) a tonne at the midday break, set for a
second straight day of gains. 
    Before eking out a gain of 0.2 percent on Monday, the
contract fell to its lowest in more than 1-1/2 years at 2,350
ringgit a tonne.     
    Trading volumes on Tuesday at midday stood at 17,542 lots of
25 tonnes each at the midday break. 
    Another trader said that gains in related edible oils such
as soyoil on the U.S. Chicago Board of Trade and China's Dalian
Commodity Exchange lent support to palm. 
    Palm oil prices are impacted by movements in rival edible
oils as they compete in the global vegetable oils market.
    The Chicago Board of Trade's May soybean oil contract
 gained 0.5 percent on Monday, and was slightly up on
Tuesday by 0.1 percent. 
    The May soybean oil on China's Dalian Commodity Exchange
 rose 0.2 percent and the Dalian May palm oil contract
 rose 0.1 percent.
    Palm oil may bounce into a range of 2,403-2,420 ringgit per
tonne, according to Wang Tao, a Reuters market analyst for
commodities and energy technicals.
    
    Palm, soy and crude oil prices as of 0447 GMT
 Contract          Month    Last  Change     Low    High  Volume
 MY PALM OIL       MAR8     2390   +0.00    2377    2390      74
 MY PALM OIL       APR8     2391   +9.00    2377    2395     511
 MY PALM OIL       MAY8     2392  +11.00    2373    2396    7604
 CHINA PALM OLEIN  MAY8     5094   +6.00    5026    5102  263486
 CHINA SOYOIL      MAY8     5688  +12.00    5640    5706  217124
 CBOT SOY OIL      MAY8    31.79   +0.00   31.68   31.81    2586
 INDIA PALM OIL    MAR8   634.30   +1.50  633.80   634.7      81
 INDIA SOYOIL      MAR8      776   +1.65  774.65     776      20
 NYMEX CRUDE       APR8    61.21   -0.15   61.16   61.41   20009
  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 = 3.9050 ringgit)
($1 = 64.9475 Indian rupees)
($1 = 6.3240 Chinese yuan)
    

 (Reporting by Emily Chow; Editing by Tom Hogue)
  
 
 
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