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VEGOILS-Palm hits 1-mth top on US weather woes, Ramadan demand
July 2, 2012 / 5:51 AM / 5 years ago

VEGOILS-Palm hits 1-mth top on US weather woes, Ramadan demand

* Futures touch 3,090 ringgit, highest since May 31
    * Malaysia's June palm oil exports rise 4.9 pct from May
    * Palm oil to gain more to 3,155 ringgit -technicals

 (Updates prices, adds SGS export data)
    By Chew Yee Kiat
    SINGAPORE, July 2 (Reuters) - Malaysian crude palm oil
futures rose to a one-month high on Monday, driven by a stronger
demand outlook for palm oil as a  worsening U.S. drought could
further tighten global oilseed supplies.    
    Market optimism after Europe leaders agreed to shore up the
region's troubled banks and rising demand ahead of the Muslim
fasting month Ramadan that begins in end-July continued to
support prices.
    "Palm oil is up in line with the higher external markets on
Friday thanks to the European summit. The persistent hot and dry
weather in the U.S. also pushed prices up," said a trader with a
foreign commodities brokerage in Malaysia.
    "Demand is there as we are moving into Ramadan. Demand from
China and India will also pick up because there's the fear that
prices will rise further."
    Benchmark September palm oil futures on the Bursa
Malaysia Derivatives Exchange gained 2.3 percent to close at
3,088 ringgit ($977) per tonne. Prices earlier touched a high of
3,090 ringgit, a level not seen since May 31.
    Traded volumes stood at 26,314 lots of 25 tonnes each, a tad
higher than the usual 25,000 lots.
    On the technicals front, the outlook is bullish as palm oil
will rise more to 3,155 ringgit, said Reuters market analyst
Wang Tao, based on a wave analysis. 
    Although the U.S. Department of Agriculture said on Friday
in a report that U.S. farmers planted far more soybeans than
they originally planned, it failed to ease concerns over a
Midwest drought that has jeopardized a bumper harvest.
    Lower soybean stocks for crushing into soybean oil will add
support to palm oil, which is already trading at a discount.
    Palm oil demand remains healthy with Malaysian exports for
June rising by about 5 percent compared to a month ago, said
cargo surveyor Intertek Testing Services on Saturday. 
    Another cargo surveyor Societe Generale de Surveillance
reported an almost 10 percent increase in exports for the same
    Brent crude oil fell more on Monday after factory data in
Europe and Asia pointed to a sharp slowdown in global economic
activity and lower fuel demand.    
    Dry weather concerns that threatened to squeeze global
oilseed supply also lifted other vegetable oil markets. U.S.
soyoil for July delivery edged up 0.8 percent after
hitting the highest level since May 9. 
    The most active January 2013 soyoil contract on
Dalian commodity exchange closed 1.4 percent higher after
touching its highest since May 11.  
  Palm, soy and crude oil prices at 1005 GMT
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      JUL2    3054   +62.00    3019    3054      15
  MY PALM OIL      AUG2    3070   +70.00    3037    3070    1224
  MY PALM OIL      SEP2    3088   +68.00    3046    3090   18384
  CHINA PALM OLEIN JAN3    8096   +98.00    8096    8224  242098
  CHINA SOYOIL     JAN3    9632  +136.00    9620    9746  520246
  CBOT SOY OIL     DEC2   53.28    +0.20   52.96   53.83   11299
  NYMEX CRUDE      AUG2   83.32    -1.64   83.16   85.05   37615
  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=3.16 Malaysian ringgit)

 (Editing by Himani Sarkar and Joseph Radford)

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