Palm oil trades flat, hovers near six-month low

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KUALA LUMPUR (April 11): Malaysian palm oil futures traded flat on Tuesday, after posting their sharpest intraday fall in two months in the previous session, as the market showed mixed signals on rising output and stronger-performing related oils.

Palm oil prices are usually weighed down by increasing supplies, but supported by gains in competing oils such as soyoil as they compete for a share in the global vegetable oils market.

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was flat at RM2,593 (US$584.93) a tonne at the midday break. Earlier in the session, it hit a six-month low of RM2,580, its weakest level since Oct 11.

Traded volumes stood at 18,824 lots of 25 tonnes each at noon.

"(China's) Dalian and Chicago Board of Trade soyoil look supportive... The outlook is not so bearish today," said a trader from Kuala Lumpur.

Palm oil prices on Monday closed at their lowest since Oct 11 after a Malaysian industry regulator released production data, which revealed end-stocks outpaced expectations.

Data from the Malaysian Palm Oil Board (MPOB) showed that output surged 16.3% to 1.46 million tonnes in March, its first monthly gain since September, and its strongest on-month rise in over a year.

The data also stated that end-stocks rose 6.5% on-month to 1.55 million tonnes, while exports climbed 14.3% to 1.27 million tonnes.

Palm oil may break a support at RM2,591 per tonne and fall more towards the next support at RM2,561, according to analysts by a Reuters market analyst for commodities and energy technicals.

In related edible oils, soybean oil on the Chicago Board of Trade gained as much as 0.6%, while the September soybean oil contract on the Dalian Commodity Exchange was up 0.4%.

The September contract for palm olein on the Dalian Commodity Exchange slid 2.3%.

Palm, soy and crude oil prices at 0541 GMT

Contract          Month    Last   Change     Low   High  Volume
MY PALM OIL       APR7     2808   -24.00    2808   2830      60
MY PALM OIL       MAY7     2685    -2.00    2676   2688    1449
MY PALM OIL       JUN7     2593    +0.00    2580   2605    8768
CHINA PALM OLEIN  SEP7     5218  -120.00    5178   5244  482506
CHINA SOYOIL      SEP7     6012   +22.00    5950   6026  435900
CBOT SOY OIL      MAY7    31.44    +0.09   31.31  31.54    4215
INDIA PALM OIL    APR7   514.50    +1.90  511.50  515.1     295
INDIA SOYOIL      APR7    634.5    +1.65     634  634.8    1280
NYMEX CRUDE       MAY7    52.97    -0.11   52.91  53.23   21503

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 = RM4.4330)
(US$1 = 64.5875 Indian rupees)
(US$1 = 6.9024 Chinese yuan)