Palm headed for second losing day on profit-taking before holidays

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KUALA LUMPUR (Jan 26): Malaysian palm oil futures fell on Thursday morning, in line for a second straight day of losses, as traders booked profit ahead of the long break for the Lunar New Year holidays.

Weaker performing related edible oils on China's Dalian Commodity Exchange also weighed on palm, traders said.

Benchmark palm oil futures for April delivery on the Bursa Malaysia Derivatives Exchange fell 0.5% to 3,111 ringgit (US$702) a tonne at the midday break. It earlier fell to a low of 3,094 ringgit, the weakest level since Jan 23.

Traded volumes stood at 17,384 lots of 25 tonnes each at noon.

"We're seeing some profit-taking over the long break for the new year. There's no other bullish news as well, as exports have already been taken into account," said a physical trader from Kuala Lumpur, referring to data from cargo surveyors that showed improving exports.

"Interest is now very low, most players are already on leave." 

Palm oil export data showed rising demand, as shipments rose 9.3% during the Jan 1-25 period, versus the previous month, two cargo surveyors said on Wednesday.

Bursa Malaysia will be closed for the second half of the trading day on Jan 27, and on Jan 30 for the Lunar New Year celebrations.  

Palm is also weighed down by a weaker Dalian, said traders, as it tracks prices of related vegetable oils. The May soybean oil contract on the Dalian Commodity Exchange fell 0.7%, while the May contract for Dalian palm olein dropped 1%.

In other related edible oils, the March soybean oil contract on the CBOT was up 0.1%.

Palm oil remains neutral in a range of 3,089-3,169 ringgit per tonne, according to Wang Tao, Reuters market analyst for commodities and energy technicals.

Palm, soy and crude oil prices at 0551 GMT

Contract Month Last Change Low High Volume
MY PALM OIL FEB7 3260 +4.00 3245 3265 239
MY PALM OIL MAR7 3175 -7.00 3152 3180 1690
MY PALM OIL APR7 3111 -14.00 3094 3119 9294
CHINA PALM OLEIN MAY7 6272 -62.00 6270 6336 194536
CHINA SOYOIL MAY7 6958 -54.00 6956 7022 163378
CBOT SOY OIL MAR7 34.9 +0.03 34.9 35 2981
INDIA PALM OIL JAN7 597.00 -0.10 594.10 598.1 749
INDIA SOYOIL FEB7 716.75 -1.35 712.3 718.3 17920
NYMEX CRUDE MAR7 53.18 +0.43 52.93 53.27 16056

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 = 4.4340 ringgit)
(US$1 = 67.9929 Indian rupees)
(US$1 = 6.8799 Chinese yuan)