KUALA LUMPUR (June 7): Malaysian palm oil futures on Wednesday were in line for a second session of declines in four, weighed down by forecasts of rising output and falling export demand, said traders.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was down 0.6% at 2,484 ringgit (US$582.01) a tonne at the midday
Palm futures shed early gains and closed flat in the previous session. It is slightly up 0.1% for the week.
Traded volumes stood at 19,832 lots of 25 tonnes each at the midday break.
"Market is down as production figures are coming up quite strongly," said a futures trader from Kuala Lumpur. "Exports for the months of June and July are bad, as demand comes off, after Ramadan."
Palm oil output in Malaysia, the world's second-largest producer of the tropical oil, is seen gaining in the second-half of this year, on seasonal demand and as it recovers from the crop-damaging effects of El Nino.
May production likely rose 5.5% to 1.63 million tonnes from the previous month, showed a Reuters survey of planters, traders and analysts.
The survey showed exports in May jumped 13.6% on-month to 1.46 million tonnes, due to Ramadan demand.
The holy festival, which began late May this year, sees many Muslims break day-long fasts with communal feasting. Palm oil is commonly used as cooking oil or an ingredient.
However, palm oil shipments are seen falling after the festive season of Eid-al-Fitr, the holiday that marks the end of the fasting period, on less consumption and lower demand for the tropical oil.
In other related oils, soybean oil on the Chicago Board of Trade climbed as much as 0.4%, while the September soybean oil contract on the Dalian Commodity Exchange gained up to 1.3%.
The September contract for palm olein slid as much as 0.6%.
Palm oil prices are typically impacted by the performance of related edible oils, as they compete for a share in the global vegetable oils market.
Palm, soy and crude oil prices at 0503 GMT
|MY PALM OIL||JUN7||2726||-12.00||2720||2728||216|
|MY PALM OIL||JUL7||2594||-17.00||2591||2608||856|
|MY PALM OIL||AUG7||2484||-15.00||2482||2502||8384|
|CHINA PALM OLEIN||SEP7||5214||-28.00||5210||5286||352328|
|CBOT SOY OIL||JUL7||31.46||+0.07||31.39||31.52||1592|
|INDIA PALM OIL||JUN7||495.50||+0.60||493.00||495.5||192|
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 = 4.2680 ringgit)
(US$1 = 64.4400 Indian rupees)
(US$1 = 6.7920 Chinese yuan)