Malaysia palmoil prices increase

Malaysia palmoil prices increase

KUALA LUMPUR (Reuter): Malaysian palmoil prices rose in late trading and closed higher yesterday as rumors of tight supply in Indonesia and buying by some Pakistan private parties prompted shortcovering, traders said.

"Shortcovering and trade buying emerged on talk that there is a supply squeeze in Indonesia," a trader said. "Rains are said to have delayed CPO deliveries," he said.

Sentiment was supported by rumors that some Pakistani traders have bought some RBD palmoil for December shipment, dealers said, but were unable to provide further details.

"Purchases by Pakistan private parties are normally direct deals with sellers," a dealer said. Trading volume on the futures market was 1,936 lots against 2,287 on Tuesday.

The market was also underpinned by continuing talk that China has cut its import duties on palmoil to 13 from 20 percent, dealers said.

Prices were marked up in late Tuesday trading on the Chinese import duty cut rumor. Traders said this has prompted fresh buying interest from China for RBD palmolein for December/January shipment. The market is awaiting confirmation from the Chinese authorities.

News of Egypt's purchases overnight also supported prices.

Egypt bought 20,000 tons of palm stearin for second half January delivery -- 10,000 tons from Malaysia's Pan-Century and 10,000 from a Singapore firm at US$546 C & F per ton.

Morning prices were slightly easier as players liquidated their positions ahead of two cargo surveyors' Caleb Brett and SGS (M) Sdn Bhd release of November palmoil export data which is due out on Friday.

"We don't expect to see good export figures for November, a dealer without giving any export estimate.

Third month February futures rose nine ringgit to 1,389 ringgit ($546.42) a ton.

Physical saw business among nearby CPO but little interest was noted in products. December crude palmoil (south) was offered at 1,410 ringgit after trading from 1,400 to 1,405.

In refined products, December RBD palmoil was offered at $570 a ton FOB Malaysia and January/February/March at $575. December was dealt at $565. Traders said December RBD palmolein was offered at $590 and January/February/March at $595. December RBD palm stearin noted offers at $520 and January/February/March at $512.50. December/January palm fatty acid distillate was offered at $410.