March 7, 2018 / 7:17 AM / 16 days ago

Palm oil prices to hit 2,600 rgt/T before falling to 2,300 rgt - analyst Fry

KUALA LUMPUR, March 7 (Reuters) -

* Malaysian crude palm oil futures are seen rising to 2,600 ringgit ($666.32) a tonne before falling back to 2,300 ringgit by July, leading analyst James Fry said

* Palm oil prices will then further decline to 2,200 ringgit when export taxes are restored, said Fry, speaking at an industry conference in Kuala Lumpur on Wednesday

* “I expect Bursa Malaysia Derivatives (BMD) prices to rise briefly towards 2,600 ringgit as stocks fall, but then fall to near 2,300 ringgit by July, before export taxes are restored, pushing BMD (prices) to 2,200 ringgit,” said Fry

* Crude palm oil prices are seen falling to below $600 a tonne on a free-on-board (FOB) basis after June due to rising stockpiles, and below $575 a tonne during the last quarter of this year, said Fry, chairman of commodities consultancy LMC International

* Fry’s estimates based on Brent crude trading in a $65-$70 a barrel range

* Benchmark palm oil futures on the Bursa Malaysia Derivative Exchange last traded up 0.6 percent at 2,478 ringgit a tonne on Tuesday evening, after trading at one-month lows earlier in the week

* Crude palm oil prices on Malaysia FOB basis PALM-MYFOB-P1 were at $641 on Tuesday

* Malaysian palm oil stocks not expected to fall below 2.3 million tonnes this year, and will see end-2018 levels higher than the previous year due to India’s move to raise its import taxes on palm oil, said Fry

* Fry forecasts global crude palm oil output will grow by more than 4 million tonnes in 2018

* Global palm oil production is seen rising this year as trees recover from crop-damaging El Nino weather event in 2015

* Fry last forecast Malaysian production at over 21 million tonnes in 2018, while pegging Indonesia’s at 40 million tonnes

* Indonesia and Malaysia produce nearly 90 percent of global palm oil ($1 = 3.9020 ringgit) (Reporting by Emily Chow Editing by Kenneth Maxwell)

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