21 Oct 2008
KUALA LUMPUR, Oct 20 (Reuters) - Asian vegetable oil markets gained on Monday as investors took cues from higher crude oil prices while governments and commodity cartels looked towards stabilising global markets.
Malaysian palm soared 2.6 percent while some Dalian soyoil contracts <0#DBY:> hit limit up and Chicago soyoil <0#BO:> jumped 3.8 percent during Asian hours -- recovering from losses last week after fears of a recession sparked a sell-off.
Governments world-wide pouring cash into banks and financial markets have given some support to commodities. And commodity cartels appear to be taking some action with OPEC expected to cut oil output at an emergency meeting this week.
"Vegetable oil markets around Asia are shortcovering on the expected oil output cuts from OPEC," said
"In fact, these markets are desperate for any bullish news from governments, they need that helping hand to boost prices."
The benchmark January palm contract <KPOF9> on
But other traders said the rally did not reflect slowing demand and oversupply in top vegetable oil consumers
"There is no fundamental basis, its more of a technical bounce with some broad-based gains in commodities," said a trader with a leading foreign commodities brokerage. "Exports in
Exports of Malaysian palm oil products for Oct. 1-20 fell 10.2 percent to 722,227 tonnes from 803,882 tonnes shipped between Sept. 1 and 20, cargo surveyor Intertek Testing Services said on Monday. [ID:nKLR379980]
In
The state marketing centre, which sells palm oil from state plantations, said it sold palm oil at 4,378 rupiah ($0.446) a kg, up from 4,211 rupiah per kg on Friday.
Producers in
"Both sellers and buyers are not very agressive particularly since the government has not yet decided on palm oil export tax," said the
The government so far has not announced any changes in palm oil export tax although palm oil prices in international market has fallen below a minimum reference price for tax of $550 a tonne.
In
In the physical market in
Palm, soy and crude oil prices at 1050 GMT
Contract Last Net chg Settle Open High Low Volume
PALM OIL NOV8 1720 + 66.00 1700 1720 1737 1687 452
PALM OIL DEC8 1675 + 45.00 1675 1686 1722 1659 1408
PALM OIL JAN9 1677 + 42.00 1677 1699 1727 1660 6799
PALM OIL FEB9 1680 + 40.00 1680 1707 1730 1664 987
CBOT soyoil* 36.86 + 1.36 35.50 N/A 37.16 35.60 N/A
NYMEX crude** 74.15 + 2.30 71.85 N/A 74.25 71.81 N/A
Palm oil prices in Malaysian ringgit per tonne
* Soy oil in U.S. cents per pound
** Crude in USD per barrel
($1=3.5200 ringgit, 6.8294 yuan, 9,810 rupiah)
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