Palm climbs to one-week high on rising price outlook

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KUALA LUMPUR (Jan 17): Malaysian palm oil futures reversed losses in its second half of trade on Thursday, rising to a one-week peak as sentiment turned  bullish on higher price forecasts from an industry conference. 

The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange rose 1.1% to 2,198 ringgit (US$534.53) a tonne in the evening, after climbing to a one-week top of 2,200 ringgit.

Trading volumes stood at 29,988 lots of 25 tonnes each at the end of the trading day.

Prices rose following price forecasts from an industry conference in Malaysia's administrative capital of Putrajaya on Thursday, said a Kuala Lumpur-based futures trader.

Crude palm oil prices are expected to rise to between 2,200 and 2,300 ringgit (US$559) per tonne by June on a seasonal decline in stocks, said industry analyst Julian McGill from commodities consultancy LMC International.

McGill also added that moves by Indonesia and Malaysia to increase the palm oil mix in biodiesel will reduce stockpiles.

Palm oil output in Malaysia, the world's second-largest producer, is forecast to rise to 20.3 million tonnes this year, said the director-general of the Malaysian Palm Oil Board at the conference.

Average palm oil prices are also seen rising to over 2,500 ringgit a tonne this year, said another MPOB official.

In other related oils, the Chicago March soybean oil contract was last up 0.4% and the May soybean oil contract on the Dalian Commodity Exchange fell 1%. 

The Dalian January palm oil contract declined 0.5%.

Palm oil prices are impacted by movements in soyoil rates, as they compete for a share in the global vegetable oil market.
           
 Palm, soy and crude oil prices at 1137 GMT:

Contract Month Last Change Low High Volume
MY PALM OIL FEB9 2123 +31.00 2083 2123 969
MY PALM OIL MAR9 2168 +31.00 2128 2169 5307
MY PALM OIL APR9 2197 +23.00 2165 2200 12939
CHINA PALM OLEIN JAN9 4200 -22.00 3992 4200 556
CHINA SOYOIL JAN9 5170 +12.00 5168 5170 120
CBOT SOY OIL JAN9 28.32 +0.09 28.15 28.36 5856
INDIA PALM OIL JAN9 547.00 +2.90 544.00 548.5 480
INDIA SOYOIL JAN9 762.8 +0.90 760.5 764.45 7740
NYMEX CRUDE FEB9 51.65 -0.66 51.59 52.36 52418

 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 

(US$1 = 4.1120 ringgit)
(US$1 = 71.0450 Indian rupees)
(US$1 = 6.7697 Chinese yuan)