Palm hits over one-week low on higher production outlook

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KUALA LUMPUR (April 11): Malaysian palm oil futures edged down to their lowest in more than a week on Thursday evening, weighed down by expectations of rising production.

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was down 0.7% at 2,154 ringgit (US$523.83) a tonne at the close of trade in its second session of declines.

The market earlier fell by up to 1% to 2,148 ringgit, its lowest level since April 2.

The market dropped as much as 2% in the previous session as official data from the Malaysian Palm Oil Board (MPOB) showed March end-stocks and production at higher levels than expected. 

The MPOB data showed end-stocks declined 4.6% to 2.92 million tonnes from February, while output rose 8.3% to 1.67 million tonnes on the month.

"Players are digesting April's supply and demand after Wednesday's selloff on higher-than-expected MPOB stocks," said a Kuala Lumpur-based trader. 
 
"However, I think we are seeing a lower market on a higher April production outlook."

Meanwhile, Malaysian palm oil exports during the April 1-10 period rose from the corresponding period last month by 6.2% and 12.6%, according to Amspec Agri Malaysia and Intertek Testing Services respectively.

Cargo surveyor Societe Generale de Surveillance reported a 27.6% gain in exports in the same time period.

In other related oils, Chicago May soybean oil contract was down 0.3%, and the May soyoil contract on the Dalian Commodity Exchange slipped 0.4%.

Meanwhile, the Dalian May palm oil contract declined 0.6%.

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 1105 GMT  

 Contract          Month    Last  Change     Low    High  Volume
 MY PALM OIL       APR9        0  -16.00       0       0       0
 MY PALM OIL       MAY9     2112  -18.00    2104    2144    1656
 MY PALM OIL       JUN9     2155  -16.00    2148    2180   19595
 CHINA PALM OLEIN  MAY9     4462  -28.00    4440    4474   93772
 CHINA SOYOIL      MAY9     5434  -20.00    5430    5462   72840
 CBOT SOY OIL      MAY9    28.97   -0.10   28.95   29.06    3280
 INDIA PALM OIL    APR9   533.40   -2.40  532.00   536.9     361
 INDIA SOYOIL      APR9    740.6   -2.65   739.7   741.9    1530
 NYMEX CRUDE       MAY9    64.06   -0.55   63.87   64.49  139172

 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 = 6.7142 Chinese yuan)
(US$1 = 68.8900 Indian rupees)