Palm oil futures lower

Published November 21, 2008

KUALA LUMPUR, Nov 20: Malaysian palm oil futures inched lower on Thursday, pressured by faltering crude oil prices on fears of slowing demand, traders said.

News of stronger exports for Nov. 1 to 20 failed to reassure the market as the increase is seen as too small to substantially reduce stock levels, traders said.

The benchmark February contract on the Bursa Malaysia Derivatives Exchange ended down 12 ringgit, or 0.8 per cent, at 1,468 ringgit ($405) per ton after going as low as 1,428 ringgit.

Other traded contracts fell between 2 ringgit and 33 ringgit. Overall volumes stood at 11,897 lots of 25 tons each.

Malaysia may see a decline in record stocks of palm oil from December as bad weather hits output and the government pushes forward with its biodiesel and replanting plans, an industry regulator said on Thursday.

Exports of Malaysian palm oil products for Nov. 1-20 rose 16 per cent to 836,659 tons from 722,227 tons shipped between Oct 1 and 20, cargo surveyor Intertek Testing Service said on Thursday.

In Indonesia, the world's biggest palm oil producer, palm prices were steady, supported by weak rupiah. The local currency tumbled to its weakest level since the Asian financial crisis a decade ago.

The state marketing centre said it had sold 6,000 tons of crude palm oil out of 9,500 tons it offered, at a top price of 5,050 rupiah ($0.422) per kg compared with 5,025 rupiah per kg on Wednesday.

Producers in Medan -- home to Belawan port, Indonesia's key port for palm oil exports -- sold palm oil at 4,975-5,003 rupiah per kg. There was no auction on Wednesday.

Meanwhile, refiners in Jakarta sold refined, bleached,deodorised (RBD) palm olein, which is used in cooking oil, at 5,600-5,700 rupiah per kg compared to about 5,600 rupiah per kg on Wednesday.—Reuters

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