KL palm oil ends lower ahead of holiday

KL palm oil ends lower ahead of holiday

KUALA LUMPUR (Reuters): Liquidation dragged Malaysian palm oil futures lower by the close on Monday as trading dwindled ahead of the Chinese New Year holiday, traders said.

The benchmark third-month April futures contract ended down five ringgit at 810 ringgit ($213.15) a ton. Volume was thin at 764 lots.

The market will be closed January 23-25.

"The market is very dull. People liquidated their positions ahead of the Chinese New Year and there's nothing much to do," said one trader.

"The market did not go anywhere," he added.

Prices also fell in the physical market, but further declines were prevented by demand at the lower levels.

Traders said prospects for a mild recovery had deteriorated after crop figures indicated output would remain high in the next few months.

Market talk late last year suggested prices, now hovering at 15-year lows, might rebound in the first quarter when seasonally trees normally produce less palm oil.

But talk last week suggested output would not slow, rising to 950,000 tons in January from December's 943,000.

In a recent report private forecaster Ivan Wong said oil palm yields were likely to remain positive for at least another six months after resuming their uptrend last October.

Physical January (south and central) crude palm oil was offered at 740 ringgit against bids of 735. Trade was reported at 735 for central.

February (south and central) crude palm oil was offered at 755 ringgit a ton against bids of 750 and trade was done at 750 for both south and central regions.

Among refined products, February RBD palm oil was offered at $217.50 a ton FOB and March at $225.

There were offers for February RBD olein at $225 and March at $232.50.

February RBD palm stearin was offered at $197.50 and February palm fatty acid distillate at $190.