Malaysian palm oil futures fall on adequate stock

Malaysian palm oil futures fall on adequate stock

Bloomberg/Jakarta

Palm oil futures in Malaysia fell as factories that buy the
edible oil have adequate stock to meet their needs for the next
few weeks, said traders and producers.

"We have inventory surplus everywhere," said Ferdi Gunawan, a
marketing officer at PT Salim Oil Grains, a Jakarta- based palm
oil producer. "The market will be bearish for the next two to
three weeks."

Indonesia, Malaysia, China and India have enough palm oil in
stock to meet their requirements in the coming weeks, Gunawan
said. Palm oil stockpiles in Malaysia rose to 1.41 million tons
in November, the highest since February 2001, according to the
Malaysian Palm Oil Board, a government agency. Indonesia doesn't
provide stockpile data.

Palm oil futures on the Malaysian Derivatives Exchange for
March delivery fell 13 ringgit, or 0.94 percent, to 1,374 ringgit
a ton ($362) at 1:07 p.m. in Kuala Lumpur. The contract last week
rose 0.1 percent to 1,387 ringgit amid concern supply from
Indonesia could fall after the world's most powerful earthquake
in 40 years hit the island of Sumatra.

Three out of four traders and producers polled by Bloomberg in
Kuala Lumpur and Jakarta today said they plan to sell palm oil
this week. The fourth said she planned to buy the commodity.

"We have increased rainfall in Sumatra, but that's seasonal
and temporary. It shouldn't boost prices" of palm oil, said Salim
Oil's Gunawan.

Last week's earthquake and tsunamis aren't expected to have
any significant impact on Indonesia's palm oil output, said
Gunawan.