Palm gains over 1% on bullish output forecasts

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KUALA LUMPUR (April 9): Malaysian palm oil futures climbed over 1% in the first half of trade on Tuesday, as the market cheered bullish outlook on March production and inventory levels.

Traders expect data from the Malaysian Palm Oil Board scheduled for release on Wednesday to show declines in March end-stocks, as exports remain strong and output gains are slight.  

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was up 1.2% at RM2,227 (US$543.97) a tonne at the midday break, marking its strongest gain in three sessions.  

"All the polls are quite bullish, hence, the continuation of the market's uptrend," said a Kuala Lumpur-based trader.

Malaysia's palm oil stockpiles in March are likely to have dropped by 6.4% from February to 2.85 million tonnes, its lowest in five months, according to a Reuters survey, as a hefty jump in exports outpaced production gains.

The market was also expecting export data for the first 10 days in April to show gains compared with the corresponding period in March, another futures trader said.

Malaysian palm oil export data for the 1-10 April period from cargo surveyors are scheduled for release after 0300 GMT on Wednesday.     

In other related oils, Chicago May soybean oil contract was up 0.2%, and the May soyoil contract on the Dalian Commodity Exchange dropped 0.3%.

Meanwhile, the Dalian May palm oil contract gained 0.3%.

Palm oil prices are affected by movements in soyoil, as they compete for a share in the global vegetable oil market.

Palm, soy and crude oil prices at 0449 GMT

Contract          Month    Last   Change     Low   High  Volume
MY PALM OIL       APR9        0    +0.00 0 0 0
MY PALM OIL       MAY9     2209   +25.00    2195   2210     557
MY PALM OIL       JUN9     2227   +27.00    2210   2229    6795
CHINA PALM OLEIN  MAY9     4490   +14.00    4440   4494  167146
CHINA SOYOIL      MAY9     5436   -14.00    5414   5458   59484
CBOT SOY OIL      MAY9    28.94    +0.06   28.78  28.98    3571
INDIA PALM OIL    APR9   548.00    +4.20  546.20  548.5     120
INDIA SOYOIL      APR9   750.45    +1.65  749.55  750.5    1060
NYMEX CRUDE       MAY9    64.54    +0.14   64.33  64.77   35208

Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in US 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 US dollars per barrel

(US$1 = RM4.0940)
(US$1 = 6.7137 Chinese yuan)
(US$1 = 69.5175 Indian rupees)