FCPO : Info & Analysis

[Sony_Boy]

Asian Crude Palm Oil Ends Up On Rise In Exports, Crude Oil

(Dow Jones)--Crude palm oil futures prices on Malaysia's derivatives exchange rose 2.1% Monday, prices ending above MYR2,300 a metric ton for the first time in more than two months, as investors covered short positions due to higher exports and stronger crude oil prices in Asia.

The new benchmark February contract on the Bursa Malaysia Derivatives ended MYR48 higher at MYR2,336 a ton, after trading in a range of MYR2,305-MYR2,359/ton. For the past two months, CPO futures have mostly traded between MYR2,020 and MYR2,280/ton. Prices moved higher in the afternoon session after the New York Mercantile Exchange crude oil rose more than $1 to an intraday high of $77.56 a barrel in trading on Globex. At 0950 GMT, light, sweet crude for December delivery was trading $1.09 higher at $77.44 a barrel.

"Both soyoil and crude oil have been trading higher during Asian trading hours and this, along with higher exports, sustained prices above MYR2,300 levels," said a vegetable oil importer in Malaysia. Cargo surveyor Intertek estimated Malaysia's palm oil exports in the first 15 days of November up 13% from the same period last month at 674,148 tons. Another surveyor, SGS (Malaysia) Bhd., estimated Nov. 1-15 exports up 21% at 717,936 tons.

The rise in exports of palm oil and palm oil products was attributed mainly to buying by exporters of crude palm oil. CPO exports rose 53%-72% on month, according to the data from the surveyors. European and Chinese buyers stepped up purchases of palm oil products as "a depressed BMD market made prices very attractive to buyers," an executive from Kuala Lumpur-based trading company said. "Palm exports to the E.U. are up on rising industrial (oleochemicals) demand for the commodity."

Intertek estimated exports to the E.U. at 189,864 during the Nov. 1-15 period, up 17.3% from a month earlier. SGS put shipments to China at 199,890 tons, up from 140,331 tons. "The (palm oil) export demand may be sustainable and it is likely exports may match October's figures or rise higher," a Kuala Lumpur-based cash broker said. November exports are likely to rise to 1.47 million-1.52 million tons, she said. Cargo surveyors put October exports at 1.42 million-1.43 million tons.

In other news, India's vegetable oil imports in the marketing year ended Oct. 31 rose 37% to record high of 8.66 million tons, the Solvent Extractors' Association of India said Monday. Total edible oil imports were also up 46% at 8.18 million tons, it said. A rise in per capita consumption, a zero-percent duty on crude edible oil and a nominal duty on refined oil helped imports rise significantly, the association said. Imports had surprisingly not declined even during the peak domestic crushing season, and averaged nearly 2 million tons per quarter. India, a major palm oil buyer, bought 5.2 tons of CPO in 2008-09 compared with 4 million tons a year earlier. Refined, bleached and deodorized palm olein imports rose to 1.2 million tons from 730,794 tons.

In the cash market, cash palm olein for November traded at $702.50-$707.50/ton, December at $710/ton, January/February/March at $730/ton and April/May/June at $735/ton, free on board Malaysian ports, a Singapore-based trader said. Cash CPO for prompt shipment was offered MYR90 higher at MYR2,290/ton. A total of 19,503 lots of CPO were traded on the BMD versus 12,876 lots Friday. Open interest stood at 94,729 lots Monday, down from 96,400 lots. One lot is equivalent to 25 tons.

 

[Sony_Boy]

Crude Palm Oil Ends Little Changed In Choppy Trade

(Dow Jones)--Crude palm oil futures prices on Malaysia'ss derivatives exchange were little changed Tuesday, with investors taking profit after prices were unable to sustain early gains due to a pullback in crude and soyoil prices in Asia.

The benchmark February contract on the Bursa Malaysia Derivatives ended MYR6 higher at MYR2,342 a ton, after trading in a narrow range throughout the day.

Prices were a tad choppy in the afternoon session, moving in positive and negative territories as weak crude pressured prices while palm oil's widening discount to soyoil supported. "Prices are taking a breather (after rising 2.1%) yesterday. But CPO prices aren't likely to dip too much, as palm oil is trading at a $140-$150/ton discount to soyoil," making the former a cheaper alternative to soyoil, said a senior executive from Kuala Lumpur-based commodities brokerage.

He added palm oil prices will likely be supported by "weather concerns, as heavy rains and floods may disrupt harvesting activity in oil palm estates." Expectations of a likely rise in November exports also helped support prices, traders said. Cargo surveyor Intertek yesterday estimated Malaysia's Nov. 1-15 palm oil exports rose 13% from the same period last month to 674,148 tons. Another surveyor, SGS (Malaysia) Bhd., estimated the exports rose 21% to 717,936 tons.

Light, sweet crude oil on the New York Mercantile Exchange was trading 46 cents lower at $78.44 a barrel on Globex at 1112 GMT. "CPO prices have risen significantly in the past few days and buying interest may ease off until palm futures come down to the MYR2,300 level," a Hong Kong-based edible oils trading executive had said earlier.

In the cash market, cash palm olein for December traded at $717/ton and $715/ton, April/May/June at $740/ton, $737.50/ton and $735/ton, free on board Malaysian ports, a Singapore-based trader said. Cash CPO for prompt shipment was offered MYR10 lower at MYR2,280/ton. A total of 15,620 lots of CPO were traded on the BMD versus 19,503 lots Monday. The open interest stood at 96,158 lots Tuesday, down from 94,729 lots. One lot is equivalent to 25 tons.

 

[Sony_Boy]

BMD CPO Likely Rangebound; Outlook Bullish - Analyst (18 Nov, 2009)

[Dow Jones] BMD CPO futures likely to trade rangebound, prices likely to move higher as market outlook gradually turning bullish, says analyst at Kenanga Deutsche Futures. Adds investors to stay long, buy on dips -- stop-loss placed at MYR2,231. Market anticipating November production to fall to around 1.5 million tons as monsoon rains may disrupt oil palm harvest. "The MYR2,350 level will continue to put a lid on prices until CPO futures close above the level, with the next resistance at MYR2,400-MYR2,425 level. A strong market should not see prices below yesterday's intraday low of MYR2,326/ton." Support at MYR2,305, then MYR2,285. Benchmark BMD February CPO futures now trading MYR27 higher at MYR2,369/ton.

BMD CPO Futures Above MYR2,400/Ton On Crude, Weather

Crude palm oil futures on Malaysia's derivatives exchange rose above MYR2,400 Wednesday, the highest level since Sept. 24, as investors took leads from higher crude prices and weather concerns, said trade participants. The benchmark January contract on Bursa Malaysia Derivatives rose as much as 3.1% or MYR73 to an intraday high of MYR2,415 a metric ton. The February contract was trading MYR54 higher at MYR2,396/ton.

Most investors covered short positions as prices rose above MYR2,400, trade participants said. "Prices rallied as market participants are very concerned about the weather conditions affecting key vegetable oils and oilseeds producing countries," said a senior trading executive in Kuala Lumpur. He said talk of likely localized floods in several key oil palm growing states in Malaysia supported palm oil prices.

Continuous rains and localized floods in the Pahang, Perak, Sabah and Johor states may slow down oil palm harvesting and affect production. "Looking at the progress of the monsoon in peninsular Malaysia, localized floods may occur in the eastern parts of Johor likely next week if heavy rains persist throughout the week," said a spokeswoman from the Malaysian Meteorological Department.

The rise in crude prices also gave spillover support to palm oil prices, said a Malaysia-based exporter. On the New York Mercantile Exchange, light, sweet crude for December delivery was trading 43 cents higher at $79.58 a barrel on Globex.

 

[Sony_Boy]

Asian Crude Palm Oil Ends Up On Weather Concerns, Crude Oil (18 Nov 2009)

(Dow Jones)--Crude palm oil futures prices on Malaysia's derivatives exchange ended 2.5% higher Wednesday, at its highest since Aug. 24, following short covering as investors took leads from higher crude prices and heavy rains across oil palm growing regions.

The benchmark February contract on the Bursa Malaysia Derivatives ended MYR58 higher at MYR2,400 a ton, after moving in MYR2,345-MYR2,425/ton range.

"CPO futures may rise to MYR2,450-MYR2,500 in the next two weeks" if crude oil prices remain steady and export demand continues to gather momentum, said a senior executive from a Kuala Lumpur-based trading firm. Buyers who were buying cautiously for the past few months are gradually turning aggressive, particularly in China, trade participants said.

Unfavorable weather conditions in key growing areas may lead to further tightness in global stocks, prompting buyers to lock in supplies. Thunderstorms and rains have continued to lash Malaysia's oil palm growing regions, with heavy rains threatening to flood some areas in Johor, according to a spokeswoman from the Malaysian Meteorological Department. She said localized floods may likely occur in the eastern parts of Johor next week if heavy rains persist.

The weather bureau also upgraded a heavy rain alert for Kelantan and Terengganu areas, stating heavy rains will likely continue until next Tuesday in several areas and may cause floods in areas near rivers. While the current monsoon isn't likely to eat into palm oil stocks, sentiment is being affected as floods and heavy rains may disrupt oil palm harvesting.

At 1038, GMT light, sweet crude for December on the New York Mercantile Exchange was trading 86 cents higher at $80.00 a barrel. December soyoil on the Chicago Board of Trade was trading 20 points higher at 40.01 cents/pound on e-CBOT by the end of trade on the BMD.

In the cash market, cash palm olein for November was offered $10 higher at $730/ton; cash palm oil for prompt shipment offered MYR20 higher at MYR2,300/ton. A total of 15,620 lots of CPO were traded on the BMD versus 15,620 lots Tuesday. The open interest stood at 94,596 lots Wednesday, down from 96,158 lots. One lot is equivalent to 25 tons.

 

[Sony_Boy]

BMD CPO Futures To Consolidate Gains; More Upside (19 Nov 2009)

[Dow Jones] BMD CPO futures may consolidate gains this week, but upside momentum remains intact as market outlook turning bullish on improved palm oil exports, says analyst at Kenanga Deutsche Futures. Adds investors to stay long, buy on dips, with stop-loss placed at MYR2,243. "Resistance is expected to come at the MYR2,415-MYR2,425 level." Benchmark BMD February CPO futures open MYR9 lower at MYR2,391, in line with market expectations. Cargo surveyors to issue Malaysia palm oil exports for Nov. 1-20 period on Friday.

Palm Oil in Malaysia Declines for the First Time in Six Days

(Bloomberg)--Palm oil fell for the first time in six days after reaching a three-month high yesterday as investors judged the five-day rally as overdone. Prices gained 7.4 percent in the previous five days, with the relative strength index rising above 70 yesterday, a signal some investors use to indicate prices will drop. “It could be some profit-taking but the fundamentals of the commodity are very sound,” Nirgunan Tiruchelvam, a plantation analyst at Royal Bank of Scotland Asia Securities (Singapore) Pte, said by phone. “The levers of international trade are moving in favor of soft and hard commodities.”

February-delivery palm oil dropped as much as 1.1 percent to 2,373 ringgit ($701) a metric ton on the Malaysia Derivatives Exchange and was at 2,394 ringgit by the 12:30 p.m. break. Palm oil has jumped 40 percent this year, boosted by the 78 percent advance in crude oil and as investors seek a hedge against inflation amid a 7.5 percent decline in the dollar against a basket of six major currencies. “External factors like inflation and a weak dollar are going to push it up,” Tiruchelvam said. Palm oil prices in Rotterdam might trade at an average of $780 for the rest of the year, he added. Rotterdam prices closed at $735 a ton yesterday, and averaged $668.36 this year.

Soybeans

Better weather conditions in South America and crude oil trading between $75 and $80 a barrel will moderate the palm oil rally, Mona Surya, a director at PT Perkebunan Minanga Ogan, a crude palm oil producer, said yesterday. Brazil and Argentina are the largest soybean producers after the U.S. and sowing is under way until January. Palm oil competes with soybean oil for applications in cooking and biofuels.

Soybean oil for January delivery in Chicago was little changed at 40.26 cents a pound at 12:13 p.m. Singapore time, a premium of $182.11 a ton over palm oil, according to Bloomberg calculations. Soybean prices may gain 20 percent by March as economic growth in China, the world’s largest importer, boosts demand for animal feed and cooking oil, Danny Murphy, treasurer of the U.S. Soybean Export Council, said in an interview. The oilseed may surpass the nine-month high of $12.3650 a bushel reached June 5 in Chicago before new supplies from Brazil and Argentina become available, he added.

Soybeans for January delivery climbed to a three-month high yesterday and traded at $10.29 a bushel on the Chicago Board of Trade at 12:35 p.m. “Palm oil is increasingly being used as a source of cooking oil” with deregulation in China and India, the largest users, boosting demand, Tiruchelvam said. The most-active palm oil contract on the Dalian Commodity Exchange climbed as much as 0.7 percent to 6,520 yuan ($955) a metric ton, the highest level in intra-day trading since Aug. 31, and paused at 6,478 yuan at the 11:30 a.m. break.

 

[Sony_Boy]

Crude Palm Oil Ends Down; Likely Export Rise Caps Losses (19 Nov 2009)

Crude palm oil futures prices on Malaysia's derivatives exchange ended lower Thursday in cautious rangebound trade. Prices stayed in a narrow trading range, above the support level of MYR2,350, with expectations of a rise in palm oil exports paring losses, trade participants said.

However, the benchmark February contract on the Bursa Malaysia Derivatives failed to remain in positive territory as the dollar strengthened during Asian trading hours amid selling pressure in crude and soyoil. The contract ended MYR29 lower at MR2,371 a metric ton, after trading in a MYR2,360-MYR2,401/ton range.

"There is demand but buyers are cautious, making minor purchases, as prices are too high. Most buyers will probably remain on the sidelines as stocks are still ample despite talks of unfavorable weather in oil palm states in Malaysia," said a Malaysia-based exporter. Trade participants said prices will likely move in a MYR2,350-MYR2,490 range next week.

Even though buyers aren't making large-scale purchases, stocks at export destinations such as Europe have dwindled, leading to a revival in shipments this month. Export demand has been robust so far, with palm oil shipments growing 13%-21% in the Nov. 1-15 period, and may improve towards the second half of the month, shipping executives said.

Trade participants said palm oil exports in the Nov. 1-20 period will likely rise 18% compared with the same period in October, to 950,000 tons. Cargo surveyors are scheduled to issue export figures Friday. Many among exporters said export demand may continue to rise if bad weather conditions continue in key oilseed-growing areas in the region, threatening to disrupt harvest and leading to a possible tightness in global vegetable oils supply. Thunderstorms and rains have affected Malaysia's oil palm growing regions over the past few days and may lead to localized flooding in Johor, the country's key growing region.

At 104043 GMT light, sweet crude for December on the New York Mercantile Exchange was trading 48 cents lower at $79.10 a barrel. December soyoil on the Chicago Board of Trade was trading 37 points lower at 39.38 cents a pound by the end of trade on BMD.

In the cash market, cash palm olein for April/May/June traded at $747.50/ton, a Singapore-based trading executive said. Cash CPO for prompt delivery was offered MYR10 higher at MYR2,310/ton. A total of 18,821 lots of CPO were traded on the BMD versus 18,339 lots Wednesday. The open interest stood at 96,694 lots Thursday, down from 94,596 lots. One lot is equivalent to 25 tons.

 

[Sony_Boy]

Asian Crude Palm Oil Ends Up On Higher Exports, Crude Oil (20 Nov 2009)

(Dow Jones)--Crude palm oil futures prices on Malaysia's derivatives exchange ended higher Friday, tracking exports, trade participants said.

The benchmark February contract on the Bursa Malaysia Derivatives exchange ended MYR48 higher at MYR2,419 a metric ton, after trading in a range of MYR2,361-MYR2,419/ton.

Malaysia's November 1-20 palm oil exports rose 16% compared with the same period in October to 954,652 tons, according to cargo surveyor SGS (Malaysia) Bhd. Another surveyor, Intertek Agri Services, also put exports higher, at 930,133 tons, up 14.5% on month.

"The export estimates came within market expectations of around 950,000 tons, but short-covering as a result of higher crude oil prices (in the morning) and last-minute buying ahead of the weekend kept CPO prices up," said a Kuala Lumpur-based trader.

CPO prices broke through psychological resistance at MYR2,400 toward the end of the trading day as participants rushed to square off positions ahead of the weekend and a short work week next week. Markets in Malaysia and Indonesia will close Friday for national holidays.

Strong soyoil prices in after-hours trade also provided support for CPO, but traders said trade was generally sluggish, with low volumes as exports failed to exceed expectations. "The general sentiment following the release of the export data was positive, with the market leaning towards an upward price trend, but there were few cash market trades, resulting in a sluggish market," said another Kuala Lumpur-based trader. "If the exports had been higher than expected, there would have been more of a rush to negotiate trades on the cash market."

A Singapore-based trader said offers and bids for palm oil products on the cash market were at least $12.50 apart, with few negotiations resulting in successful trades.

Cash CPO for prompt delivery was offered MYR40 higher at MYR2,350/ton. A total of 13,093 lots of CPO were traded on the BMD versus 18,821 lots Thursday. Open interest was 96,736 lots Friday, up from 96,694 lots. One lot is equivalent to 25 tons.

 

[Sony_Boy]

Rains bring prospects of new highs for crude palm oil futures

OBSERVATIONS: Rising floodwaters in most parts of the country lifted the Kuala Lumpur CPO futures market to a 14-week high last week. And if the weatherman’s forecast is any guide this market can expect to hit new highs in the near-term future. The actively-traded February 2010 contract settled at the intra-week high of RM2,419 a tonne, up RM151 or 6.66 per cent over the week. Closing at the absolute high point of the week’s RM2,419-RM2,305 trading range is a bullish candlestick pattern pointing to more upside movement ahead.

The north-east monsoon which lashed most parts of the country was the principal catalyst behind this market’s well over RM250 leap in price over the past fornight. TV newscasts of the many landslips caused by rainstorms and floods in rural areas contributed to bullish sentiment. For sure the floods not only haved hampered the harvesting of palm oil fruit, they also must have disrupted the logistics of transporting the fresh fruit bunches to the refineries and palm olein to the ports for export. What’s more, the weather forecast is for more rainstorms – and therefore more floods – in the near-term future.

And fortuitously, at least for market bulls, export market monitors Societe Generale de Surveillance (SGS) and Intertek Agri Services (IAS) chimed in with scintillating export estimates. SGS and IAS’ combined export estimate of an average of some 696,000 tonnes for first half November 2009 was not only the highest for any month-to-date estimate this year, it also was about 126,000 tonnes or 17.0 per cent higher than that for the corresponding period in October 2009. That bodes well for a reduction in end-November 2009 stocks of palm oil.

Conclusion: This market can be expected to make more headway on the upside in early trade this week, before coming up against the immediate RM2,470 a tonne overhead resistance level.

 

[Sony_Boy]

Asian Crude Palm Oil Ends Up 2.8%; Speculative Buying In Oils (23 Nov 2009)

Dow Jones)--Crude palm oil futures prices on Malaysia's derivatives exchange rose as much as 3.1% Monday, its highest level since Aug. 14, due to speculative buying interest and higher crude oil and soyoil prices.

The benchmark February contract on the Bursa Malaysia Derivatives exchange ended MYR67 or 2.8% higher at MYR2,486 a metric ton, after rising to an intraday high of MYR2,489/ton. The February contract remained above the MYR2,400 level throughout the day. Palm oil futures were up 6.5% from last Monday, driven by palm oil's widening discount to rival soyoil prices.

Refined palm olein is currently trading around $150/ton cheaper than soyoil futures, making refined palm products an attractive alternative for price-sensitive buyers. Palm oil prices have been rising despite a jump in palm oil inventories to 1.98 million tons last month. Trade participants said rising export demand from China and Europe may lead to a stock drawdown in November.

It's uncommon for both China and Europe to buy more palm oil in winter, because palm oil tends to turn into a solid in cold weather earlier than other vegetable oils. China's palm oil imports rose 65% on year to 463,229 tons in October, according to the country's General Administration of Customs. "With palm oil prices rallying near the MYR2,500 level, the market may be poised for long liquidation and profit-taking in the next trading session," an executive from a global trading company said.

Palm oil price direction may also hinge on export momentum in December, a company executive from Malaysia-based plantation company said. "If November's export momentum is maintained into December, there'll be a further drawdown in stocks. However, if December exports fail to match November's pace, then we'll expect some accumulation in inventories," the company executive said.

Many producers and exporters are expecting December palm oil exports to be weak, as major vegetable oils buyers would generally have locked in their requirements through January. Malaysia's palm oil growers said November's palm oil output will likely fall 10%-15% from the previous month, as localized floods and heavy rains disrupted harvesting activities and prolonged soil moisture may affect oil palm yields.

In the cash market, cash palm olein for April/May/June was traded several times at $760/ton, $772.50/ton and $775/ton, free on board Malaysian ports, a Singapore-based trading executive said. Cash CPO for prompt delivery was offered MYR50 higher at MYR2,400/ton. A total of 17,388 lots of CPO were traded on the BMD versus 13,093 lots Friday. Open interest was 95,832 lots Monday, down from 96,736 lots. One lot is equivalent to 25 tons.

 

[orange76]

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