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UPDATE 1-Malaysian palm oil futures seen rising to 3,000 ringgit/T -Mistry
September 15, 2017 / 8:47 AM / 2 months ago

UPDATE 1-Malaysian palm oil futures seen rising to 3,000 ringgit/T -Mistry

(Adds detail, further comment from Mistry, palm oil prices)

NEW DELHI, Sept 15 (Reuters) - Malaysian palm oil futures are expected to rise to 3,000 ringgit ($715.80) a tonne if inventories in Malaysia do not climb, leading edible oil industry analyst Dorab Mistry said on Friday.

“If it appears that peak stocks will not reach 2.6 million tonnes by January 2018, prices will not decline,” he told an industry conference in Mumbai.

On Friday the benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange slid for a second day, dropping 0.5 percent to 2,852 ringgit a tonne. On Thursday, the contract hit 2,896 ringgit, the highest since March 6.

In March, Mistry had estimated prices rising to 3,000 ringgit a tonne because of tight inventories. But the market has not seen that level since February.

Malaysian palm oil stocks at the end of August stood at 1.94 million tonnes.

“If Malaysian stocks look like exceeding 2.6 million tonnes, prices will fall by 200 ringgit at most,” Mistry said.

The analyst said India is expected to import 9.65 million tonnes of palm oil in 2017/18, down from 9.32 million tonnes a year ago.

In total, India’s edible oil imports are likely to rise to 15.5 million tonnes during the year from 15.25 million tonnes shipped in 2016/17.

Indian “production is stagnating, imports are rising ... local oilseeds remain uncrushed,” he said.

Regarding crude palm oil output, Indonesia, the world’s biggest producer, is projected to have an output of 34.5 million to 35 million tonnes in 2017, Mistry said. Malaysia, the second-largest producer, is forecast to have an output of 19.8 million to 20 million tonnes this year.

“Production is surpassing expectations,” he said. “Rainfall in the palm belt has been very good.”

$1 = 4.1910 ringgit Reporting by Rajendra Jadhav; Writing by Naveen Thukral; Editing by Kenneth Maxwell and Tom Hogue

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