Speculative buying lifts KL palm oil
Speculative buying lifts KL palm oil
KUALA LUMPUR (Reuters): Speculative buying lifted Malaysia's
palm oil futures on Monday and prevented prices from falling
despite weak November 1-20 export figures, traders said.
The benchmark third-month February futures contract ended up
16 ringgit at 867 ringgit (US$228.15) a ton after trading as low
as 855.
Market volume stood at 872 lots compared with 581 at the close
on Friday.
"It's purely speculation. It does not reflect the market's
fundamentals," said one trader in Kuala Lumpur.
"Some people believe demand from Pakistan will increase during
the Ramadan fasting month and that (Malaysia's) production will
be disrupted because of the rainy season. But I would say this is
a pure speculation," he added.
Another trader said: "To my understanding, there are a few big
players who are holding the prices. It seems they are telling
buyers they are not going to sell at cheaper prices."
"Those people tell buyers to buy now or prices will go up," he
added.
Cargo surveyor Societe Generale de Surveillance Malaysia Sdn
Bhd (SGS) said Malaysian palm oil exports for the first 20 days
of November were at 571,439 tons against 659,332 for the same
period in October.
Traders said news the government will allow one million tons
of crude palm oil to be exported duty free next year had been
factored in by the market, adding that players were now waiting
for November stock/output/export figures to be issued on Tuesday
by private forecaster Ivan Wong.
November (south and central) crude palm oil was offered at 835
ringgit a ton against bids of 825 and trade at 820 to 825.
December (south) saw offers at 850 ringgit and bids at 840,
with trade reported at 840. December (central) offers stood at
850 against bids of 845. Trade was reported at 840 to 845.
Among refined products, November RBD palm oil was offered at
$237.50 a ton FOB, December at $240 and January at $245.
There were offers for November RBD palm olein at $257.50,
December at $260 and January at $267.50.
November RBD palm stearin was offered at $195 and December at
$197.50. November palm fatty acid distillate was offered at
$137.50.