KL palm oil ends off lows on short covering

KL palm oil ends off lows on short covering

KUALA LUMPUR (Reuters): Malaysian palm oil futures recouped
some losses by the close on Wednesday on short covering after a
bearish crop report from private forecaster Ivan Wong had
pressured prices.

Wong said Malaysia's palm oil output was estimated to have
risen 6.5 percent to 1.0 million tons in January from a month
earlier. He had earlier put the production at between 910,000 and
915,000 tons.

Wong put end-January stocks at 1.50 million tons, up from an
earlier projection of 1.37-1.38 million tons and compared with
1.41 million at the end of December.

Exports in January were estimated at 770,000 tons, down from
894,000 in December.

"The figures are certainly bearish and confirmed earlier
market talk," said one trader in Kuala Lumpur.

"Short covering helped limit the fall but the outlook is not
encouraging at all. You cannot be comfortable with such a high
stocks level at this time of the year," he said.

The benchmark third-month April futures contract ended down
three ringgit at 747 ringgit ($196.58) a ton after trading as low
as 735.

Volume increased to 2,354 lots against 1,963 on Tuesday.
Overnight falls in soyoil futures on the Chicago Board of Trade
also weighed on earlier prices.

Physical prices were also lower but activity was generally
light due to a holiday in several states.

February (south) crude palm oil was offered at 690 ringgit a
ton against bids of 685. It traded earlier at 680.

March (south) saw offers at 725 ringgit and bids of 720.
Among refined products, February RBD palm oil was offered at $200
a ton FOB and March at $207.50.

There were offers for February RBD olein at $207.50 and March
at $212.50.

February RBD palm stearin was offered at $190 and February
palm fatty acid distillate at $182.50.