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Wednesday, June 10, 2009

CPO PRICE FUTURES FLAT, FALLING EXPORTS

JUNE 10, 2009 
Crude palm oil futures end flat on talk of falling exports

NEWS SOURCE:

www.btimes.com.my
RELATED PALM OIL NEWS


Malaysian crude palm oil futures closed flat yesterday, giving up gains of up to around 1.6 per cent, as speculation over falling exports in the first 10 days of June sparked some late selling, traders said.

“We have to blame export rumours for the sell-off,” said a trader at a Kuala Lumpur-based brokerage.

The benchmark August contract on the Bursa Malaysia’s Derivatives Exchange settled up RM5 or 0.2 per cent, to RM2,465 per tonne, after trading as high as RM2,504. Overall volume was 15,648 lots of 25 tonnes each.
Cargo surveyors will report June 1-10 palm oil exports by the Southeast Asian country today. 

The Malaysian Palm Oil Board (MPOB) will also announce May palm oil output, exports
and stocks today.
“We heard ten day exports at 289,000 tonnes, a drop of about 28 percent (from the same period in May). It is surprising because most people only think of (a) marginal fall to like 350,000 tonnes,” the Kuala Lumpur brokerage trader said.
Weaker demand from main buyers China and India at a time palm trees are entering a higher production season in the year could boost palm oil stocks in the world’s number 2 producer this month.

Palm prices inversely correlate to palm oil stocks. A drop in palm stocks to a 22-month low in April, coupled with lower yields in rival soybeans in South America, have played a key
role in supporting the price of the tropical oil, which has gained 45 per cent this year.

A Reuters poll on Monday forecast that Malaysia’s May palm oil stocks may drop 2.3 per cent to a 23-month low at 1.26 million tonnes, as exports and domestic demand were slightly higher than output, but the pace of decline is slowing.

In the Malaysian physical market, palm oil for June delivery was traded at RM2,480-RM2,510 in the southern and central regions.

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