Palm oil falls tracking weak soyoil ahead of holidays

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KUALA LUMPUR (Jan 25): Malaysian palm oil futures declined in early trade on Wednesday, tracking weaker performing rival soyoil and as traders closed positions ahead of the Lunar New Year public holidays.

Palm had risen in the previous session, after declining for four consecutive days.

Benchmark palm oil futures for April delivery on the Bursa Malaysia Derivatives Exchange fell 0.8% to 3,123 ringgit (US$704) a tonne at the midday break. 

Traded volumes stood at 18,102 lots oaf 25 tonnes each at noon.

"Production is down and exports are up, but the market is still down. It is probably trading in a range as prices rallied too much yesterday," said a Kuala Lumpur-based futures trader. 

"The market is seeing profit-taking before the long holidays."

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 prices are also impacted by movements in prices of related edible oils, as they compete for a share in the global vegetable oils market. 

The March soybean oil contract on the CBOT was down 0.3%, while the May soybean oil contract on the Dalian Commodity Exchange fell 0.2%.

Palm oil's fundamentals however remain bullish, say traders who expect output in January to decline on seasonal trend, while exports rise. 

Malaysian palm oil shipments rose 9.3% during the Jan 1-25 period versus last month, according to cargo surveyor Intertek Testing Services on Wednesday morning.

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

In other related edible oils, the May contract for Dalian palm olein rose 0.2%.


Palm, soy and crude oil prices at 0533 GMT

Contract Month Last Change Low High Volume
MY PALM OIL FEB7 3257 -21.00 3257 3275 423
MY PALM OIL MAR7 3177 -27.00 3177 3206 3502
MY PALM OIL APR7 3123 -26.00 3123 3150 8509
CHINA PALM OLEIN MAY7 6336 +6.00 6322 6382 239788
CHINA SOYOIL MAY7 7006 -16.00 7002 7072 172152
CBOT SOY OIL MAR7 35.17 -0.11 35.06 35.3 6488
INDIA PALM OIL JAN7 595.20 -1.90 594.60 595.9 104
INDIA SOYOIL FEB7 715.5 -2.60 715.3 716.4 1550
NYMEX CRUDE MAR7 52.99 -0.19 52.87 53.07 14368

 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 = 4.4370 ringgit)
(US$1 = 68.1300 Indian rupees)
(US$1 = 6.8774 Chinese yuan)