KL palm oil seen firming on demand<\/p>\n
KUALA LUMPUR (Reuters): Malaysia's palm oil prices may bounce
\nbeyond the 1,200 ringgit level later this year on bad weather in
\nthe United States and heavier demand from major buyers like India
\nand China, an industry official said on Tuesday.<\/p>\n
\"I think it (the price) will stay around 1,200 ringgit. If the
\nU.S. (soybean) crop has problems, then it may go up further,\"
\nAhmad Ibrahim, marketing director of the state Malaysian Palm Oil
\nPromotion Council (MPOPC), told Reuters in an interview.<\/p>\n
Malaysia's palm oil futures hit 1,315 ringgit (US$346.05) a
\nton -- their highest level in 22 months -- on Aug. 8 (third-month
\nbasis), driven by concern that supplies may be hit in coming
\nmonths by adverse weather.<\/p>\n
But prices have gradually eased since then with some traders
\nsaying recent persistent rains would instead boost output from
\nthe world's largest palm oil producer.<\/p>\n
By midday on Tuesday, the benchmark third-month November
\ncontract was quoted 21 ringgit higher at 1,136 ringgit ($298.95)
\na ton as traders covered their positions after Monday's sharp
\ndrop.<\/p>\n
Ahmad said Monday's 71 ringgit slide was a correction and he
\nexpected prices to trend higher now, particularly as dry weather
\nin the U.S. may affect the soybean crop from the world's largest
\nproducer, which in turn could further boost palm oil prices.<\/p>\n
Palm oil is soyoil's direct competitor.<\/p>\n
\"What happened is that the increase in (the palm oil) price
\nwas too fast. Now it's being corrected,\" Ahmad said.<\/p>\n
\"But we see in the last few weeks, the weather is not very
\nconducive in the U.S. for a good (soybean) crop.\"<\/p>\n
Ahmad said India, the world's largest edible oil importer, was
\nalso in the market for palm oil ahead of the Diwali Hindu
\nfestival of lights in November, while China would increase its
\nintake when it joined the World Trade Organization (WTO).<\/p>\n
Malaysian government officials have said China's palm oil
\nimport quota could stand at up to 2.88 million tons in 2005,
\ncompared with 1.4 million tons in 2001.<\/p>\n
India was Malaysia's main palm oil buyer in 2000, taking 2.03
\nmillion tons.<\/p>\n
Ahmad said population growth and an improvement in purchasing
\npower was expected to boost global palm oil consumption to more
\nthan 16.5 million tons this year from 15.1 million in 2000.<\/p>\n
Demand for vegetable fats was also rising because people were
\nmore health conscious and were shunning animal fats, he said.<\/p>\n
Bangladesh imports could reach up to 300,000 tons this year
\ncompared with less than 100,000 tons last year, he said.<\/p>\n
Malaysia and Indonesia, the world's second largest palm oil
\nproducer, account for more than 85 percent of global palm oil
\nexports. About 60 percent of palm oil exports came from Malaysia
\nand 25 percent from Indonesia, Ahmad said.<\/p>\n
Malaysia's palm oil production is expected to increase 3.4
\npercent to 11.2 million tons in 2001. Indonesia's output is
\nprojected to reach 7.2 million tons this year compared with 6.5
\nmillion tons in 2000.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/kl-palm-oil-seen-firming-on-demand-1447893297",
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"sponsor_url": "https:\/\/okusiassociates.com"
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