April 9, 2013 / 5:52 AM / 5 years ago

VEGOILS-Palm eases after hitting near 2-week high on bird flu worries

* Regulator to report March stock levels on Weds
    * Malaysia April 1-10 export data also due Weds
    * Palm oil to rise to 2,440 ringgit -technicals

 (Updates prices)
    By Chew Yee Kiat
    SINGAPORE, April 9 (Reuters) - Malaysian palm oil futures
ended slightly lower after hitting a near two-week high on
Tuesday as fears over the bird flu outbreak in China and its
impact on soybean prices outweighed hopes for lower palm
inventory in the Southeast Asian nation, the world's No.2
producer.
    Industry regulator, the Malaysian Palm Oil Board (MPOB),
will on Wednesday report stock levels for March, with a Reuters
poll predicting a drop to 2.35 million tonnes from 2.44 million
in February. 
    "The rise in Dalian palm and soy and also the overnight gain
in U.S. soy are helping the rally, while traders are also
positioning ahead of MPOB data," said Ker Chung Yang, investment
analyst with Phillip Futures in Singapore. 
    "But the rise may be capped due to the bird flu situation in
China."
    Traders are keeping a close watch on the development of a
new strain of bird flu in China, fearing that it could cut
demand for soy used in animal feed in the world's top importer
of the bean, although the World Health Organization said it was
no cause for panic.        
    Soyoil is a close competitor of palm oil and a fall in soy
prices could wean away demand from palm.
    The benchmark June contract on the Bursa Malaysia
Derivatives Exchange closed 0.2 percent lower at 2,395 ringgit
($789) per tonne. Prices earlier touched a high of 2,419
ringgit, a level last seen on March 28.
    Total traded volumes stood at 29,311 lots of 25 tonnes each,
compared to the average 35,000 lots seen so far this year.
    Technicals showed palm oil is expected to rise to 2,440
ringgit, as indicated by a high-low bottom and a Fibonacci
retracement analysis, said Reuters market analyst Wang Tao.
 
    Market participants are also looking out for Malaysian palm
export data for the first 10 days of April, due on Wednesday.
Shipments edged slightly higher for March, the first increase in
four months, thanks to higher demand for refined products.
  
    In other markets, Brent crude oil rose above $105 per barrel
on Tuesday, rallying from an eight-month low after China's
inflation slowed, giving it room to keep monetary policy easy
and support oil demand in the world's second-biggest consumer.
 
    In vegetable oil markets, U.S. soyoil for May delivery
 inched up 0.1 percent in late Asian trade. The most
active September soybean oil contract on the Dalian
Commodities Exchange closed 0.5 percent higher.   
  Palm, soy and crude oil prices at 1018 GMT
                                                                              
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR3       0    +0.00       0       0       0
  MY PALM OIL      MAY3    2384    -8.00    2373    2410    1675
  MY PALM OIL      JUN3    2395    -5.00    2384    2419   15417
  CHINA PALM OLEIN SEP3    6326   +66.00    6298    6358  423328
  CHINA SOYOIL     SEP3    7930   +40.00    7918    7982  480824
  CBOT SOY OIL     MAY3   49.58    +0.06   49.42   49.65    8988
  NYMEX CRUDE      MAY3   93.58    +0.22   93.36   93.82   14376
                                                                              
  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=3.035 ringgit)   

 (Editing by Joseph Radford and Muralikumar Anantharaman)

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