Palm tracks soyoil weakness to hit lowest level in a month

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KUALA LUMPUR (June 12): Malaysian palm oil futures fell by more than 2% on Wednesday to hit their lowest levels in a month, triggered by weakness in U.S. soyoil prices on the Chicago Board of Trade. 

Palm oil prices had were earlier traded within a range, with the competing forces of expectations for bullish industry data and weakness in soyoil and crude oil prices.

Malaysia's palm oil stockpiles at the end of May dropped 10.3% from the previous month to 2.45 million tonnes, industry regulator the Malaysian Palm Oil Board said on Wednesday.

Production in May rose 1.3% month-on-month to 1.67 million tonnes. Exports climbed 3.5% from April to 1.71 million tonnes last month, the MPOB data showed. 

The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was last down 1.8% at 1,971 ringgit (US$474.37) per tonne at the close of trade, its sharpest daily decline in a week.

It earlier fell as much as 2.1% to 1,964 ringgit, its lowest level since May 13.

"Market gains earlier were capped by weaker external markets," a futures trader in Kuala Lumpur said, referring to CBOT U.S. soyoil, adding that the market's subsequent decline was due to sharper soyoil falls.

The Chicago July soybean oil contract, which had fallen 0.6% on Tuesday, was down 0.8%.

Meanwhile, the September soyoil contract on the Dalian Commodity Exchange fell 1% and the Dalian September palm oil contract eased 1.1%.

Palm oil prices are affected by movements in related edible oils, with which it competes for global market share.    
                
 Palm, soy and crude oil prices at 1030 GMT

Contract Month Last Change Low High Volume
MY PALM OIL JUN9 0 +0.00 0 0 0
MY PALM OIL JUL9 1968 -33.00 1964 2010 2680
MY PALM OIL AUG9 1971 -36.00 1964 2015 22156
CHINA PALM OLEIN SEP9 4344 -50.00 4340 4402 569046
CHINA SOYOIL SEP9 5408 -52.00 5400 5480 400048
CBOT SOY OIL JUL9 26.99 -0.23 26.93 27.32 7352
INDIA PALM OIL JUN9 493.80 -4.90 492.00 500.6 1145
INDIA SOYOIL JUN9 748.5 +2.15 743.2 749.6 5550
NYMEX CRUDE JUL9 51.84 -1.43 51.46 53.05 166048

 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 = 4.1550 ringgit)
(US$1 = 69.3340 Indian rupees)
(US$1 = 6.9187 Chinese yuan)