Vegoils Palm oil at 2-month high as rains seen disrupting supply

by **Cals** Fri 11 Dec 2015, 22:00

Vegoils

[size=28]Palm oil at 2-month high as rains seen disrupting supply

By Reuters / Reuters | December 11, 2015 : 7:11 PM MYT

SINGAPORE (Dec 11): Malaysian palm oil futures jumped 2.7% on Friday, rising to a two-month high as forecasts of rain in key producing areas heightened concerns over supply disruptions in the monsoon season.

The palm oil market dropped to a one-week low on Thursday due to a steep decline in exports. Analysts and traders expect the market to gain more ground early next year as the El Nino weather pattern reduces yields and Indonesia, the world's top producer, uses more palm oil to make biodiesel.

The February benchmark palm oil contract on the Bursa Malaysia Derivatives exchange closed up 2.7%, or 63 ringgit, to 2,440 ringgit (US$568.8) a tonne. The market hit an intra-day high of 2,442 ringgit a tonne, highest since October 6.

For the week, palm oil is up more than 3%, rising for a third week in a row. Traded volume stood at 38,406 lots of 25 tonnes each.

"It is short-covering which has supported prices," said one trader in Kuala Lumpur. "The weather is going to be wet next week, it will make it difficult to gather fresh fruit bunches."

Cargo surveyor Intertek Testing Services estimated exports of Malaysian palm oil products for Dec 1-10 fell 35.5% from a month earlier, while Societe Generale de Surveillance reported a 33.7% decline in exports.

Malaysia's monthly palm oil data on Thursday showed steep decline in production as well as exports in November.

Palm oil stocks in Malaysia, the world's second largest producer, rose to 2.91 million tonnes from a revised 2.835 million tonnes a month ago, while exports fell 12.4% to 1.5 million tonnes in November.

The MPOB data also showed an 18.87% fall in November production at 1.65 million tonnes.

In rival vegetable oil markets, the U.S. January soyoil contract declined 0.1%, while the May soybean oil contract on the Dalian Commodity Exchange added 0.3%.

Palm, soy and crude oil prices at 1010 GMT

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Contract	Month	Last	Change	Low	High	Volume
MY PALM OIL	DEC5	2250	+90.00	2250	2250	9
MY PALM OIL	JAN6	2342	+62.00	2280	2342	2576
MY PALM OIL	FEB6	2440	+63.00	2382	2442	18461
CHINA PALM OLEIN	MAY6	4730	+70.00	4646	4732	983412
CHINA SOYOIL	MAY6	5588	+16.00	5512	5594	983776
CBOT SOY OIL	JAN6	31.81	+3.70	31.52	31.90	5413
INDIA PALM OIL	DEC5	410.20	+3.70	405.10	410.70	782
INDIA SOYOIL	DEC5	633.50	+5.55	628.00	633.50	8130
NYMEX CRUDE	JAN6	36.37	-0.39	36.32	36.84	33185

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Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel

(US$1 = 4.29 ringgit)

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