Palm retreats over 1% on weak CBOT soyoil

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KUALA LUMPUR (Jan 29): Malaysian palm oil futures fell over 1% on Tuesday, retreating from the previous session's sharp gains on weakness in Chicago soyoil and overnight crude oil.

The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange opened steady at RM2,327 and was down 1.2% at RM2,300 (US$559.47) a tonne by the midday break.

Trading volumes stood at 16,225 lots of 25 tonnes each.

Palm oil futures rose for a sixth session in seven on Monday and hit their highest in nearly seven months, tracking strength in related edible oils.

"Market is overbought, so the fall is not a surprise," said a Kuala Lumpur-based trader.

Prices of soyoil on the Chicago Board of Trade fell for a second straight session on Tuesday with concerns over escalating US-China trade tensions and improved weather in Brazil weighing on the market.

The Chicago March soybean oil contract was down 0.6%.

"There is a lack of new catalyst and the market is also factoring in weaker gains in the crude oil market overnight," said another futures trader from Kuala Lumpur.

Positive export data from a cargo surveyor failed to buoy sentiment as the market had already factored it in, said the trader.

Exports of Malaysian palm oil products for Jan 1-25 rose 12% to 1,207,619 tonnes from 1,078,274 tonnes shipped a month earlier, cargo surveyor Societe Generale de Surveillance said on Tuesday.

Palm oil still targets RM2,351 per tonne as it has stabilised above a former resistance at RM2,322, Wang Tao, a Reuters market analyst for commodities and energy technicals, said.

In other related oils, the May soybean oil contract on the Dalian Commodity Exchange was up 0.3%, while the Dalian May palm oil contract was unchanged.

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

Malaysian markets will be closed on Feb 5-6 for the Lunar New Year celebrations.

Palm, soy and crude oil prices at 0510 GMT:

Contract         Month    Last  Change     Low    High  Volume
MY PALM OIL     FEB9      2182  -40.00    2182    2229     250
MY PALM OIL     MAR9      2267  -30.00    2264    2298    2035
MY PALM OIL     APR9      2300  -27.00    2297    2327    7684
CHINA PALM OLEIN      MAY9      4812   +0.00    4810    4854  261876
CHINA SOYOIL    MAY9      5770  +16.00    5764    5814  304200
CBOT SOY OIL    MAR9     30.12   -0.18   30.07   30.29    3926
INDIA PALM OIL  JAN9    561.60   -2.50  560.30   563.3      27
INDIA SOYOIL    FEB9       772   -1.75     771   773.4    3930
NYMEX CRUDE     MAR9     52.10   +0.11   51.84   52.29   34245

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 = RM4.1110)
(US$1 = 71.1300 Indian rupees)
(US$1 = 6.7440 Chinese yuan)