Speculative buying lifts Malaysian palm oil

Speculative buying lifts Malaysian palm oil

KUALA LUMPUR (Reuters): Speculative buying lifted Malaysia's
palm oil futures on Tuesday on expectations that the government
will soon announce the list of companies which will be allowed to
export crude palm oil duty-free this year.

The benchmark third position November futures contract ended
up 14 ringgit at 1,013 ringgit ($266.57) a ton, after trading as
low as 996.

Volume was 1,263 lots against 1,451 lots at the close on
Monday.

Traders pegged immediate support at 995 ringgit and resistance
at 1,030.

Traders said the concession to export CPO duty-free would not
help reduce stocks in the Malaysian market unless traders decided
to cut prices in order to win back buyers now attracted by
cheaper Indonesian products.

Traders said stocks were building up in the country's
refineries because of slack demand.

Rumors have circulated in the Malaysian market that the
government plans to allow eight companies to export CPO duty-free
in response to Indonesia's move to axe export taxes on CPO and
its by-products this month.

But Indonesia's Finance Minister Bambang Sudibyo said on
Monday the government had not yet decided whether to abolish the
CPO tax.

Traders said the physical side was active on Tuesday ahead of
a duty-free announcement.

Physical Aug (south) crude palm oil was offered at 955 ringgit
a ton against bids of 950, and traded from 940 to 950. Aug
(central) crude palm oil was traded at 945 to 950.

Sep (south) was offered at 980 ringgit against bids of 975.
Trade was reported at 970 to 975. Sep (central) was traded at
975.

Among refined products, Sep RBD palm oil was offered at $275 a
ton FOB, Oct at $280 and Nov/Dec at $287.50.

There were offers for Sep RBD palm olein at $292.50, Oct at
$297.50 and Nov/Dec at $305.

Sep RBD palm stearin was offered at $220 and Sep palm fatty
acid distillate at $185.