VEGOILS-Palm oil off 8-month highs, demand outlook cloudy

Wed Feb 22, 2012 5:33am EST

* Price target intact at 3,292 ringgit -technicals
    * Pakistan's Indonesian palm imports to quadruple
    * Wilmar's shares plunge on margin fears

 (Updates throughout)	
    By Chew Yee Kiat	
    SINGAPORE, Feb 22 (Reuters) - Malaysian crude palm oil
futures ended lower on Wednesday as nervous investors booked
profits after an upbeat demand outlook and stronger crude oil
prices helped the edible oil scale eight-month highs earlier in
the session.	
    Benchmark May palm oil futures on the Bursa
Malaysia Derivatives Exchange eased 0.6 percent to close at
3,250 ringgit ($1,075) per tonne. Prices had earlier hit a high
of 3,294 ringgit, the highest since June 9 last year.	
    Traded volumes stood at 23,723 lots of 25 tonnes each,
slightly lower than the usual 25,000 lots.	
    Global markets eased slightly on Wednesday as China's
manufacturing sector shrank for a fourth straight month, but
crude palm oil rallied on stronger Malaysian exports.	
    Prices, which are up 2.4 percent so far this year,
eventually eased as the long-term risk of a messy default in
Europe cast doubts on the health of the global economy and
commodity demand.	
    "The market is at a crossroad between bullish fundamentals
and bearish technicals," said a trader with a local commodities
brokerage in Malaysia.	
    "The strength in crude oil gave additional support. However
we anticipate some profit-taking to emerge before a significant
rally appears," the trader added.	
    Reuters analyst Wang Tao said a price of 3,292 ringgit per
tonne remains intact for palm oil, as it is still firm on an
uptrend. 	
    Malaysian palm oil exports from Feb. 1 to 20 eased 2 percent
and 0.6 percent from a month ago, according to cargo surveyors
Intertek Testing Services and Societe Generale de Surveillance
respectively.  	
    That indicated an improvement in demand prospects compared
to a 14 percent decline for the first 15 days of the month. 	
    Market players expect exports to pick up for the rest of the
month but cautioned that the lingering euro zone debt crisis may
weigh on demand.	
    Concerns about demand contributed to a drop in the shares of
Singapore's Wilmar International, the world's largest
listed palm oil firm.	
    Shares fell as much as 9 percent in early trading on
concerns about margins at its consumer business, despite the
firm reporting a 57 percent jump in its quarterly profit.
 	
    Top producer Indonesia will export more palm oil to
Pakistan, with volumes expected to more than quadruple to
800,000 tonnes over the next three years, said an executive at
an Indonesian industry group. 	
    Brent crude edged down towards $121 on Wednesday, retreating
from a nine-month high, as weaker Chinese manufacturing data and
resurfacing worries about the euro zone debt crisis cast doubt
on global economic health and prospects for fuel demand.  
  	
    The U.S. soyoil contract for March delivery lost 0.6
percent while the most active September 2012 soyoil contract
 on China's Dalian Commodity exchange inched up 0.1
percent.    	
  Palm, soy and crude oil prices at 1002 GMT
                                                                         
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      MAR2    3216   -18.00    3215    3246     318
  MY PALM OIL      APR2    3241   -19.00    3238    3281    1673
  MY PALM OIL      MAY2    3250   -18.00    3249    3294   14317
  CHINA PALM OLEIN SEP2    8366   +26.00    8350    8394   75796
  CHINA SOYOIL     SEP2    9390    +8.00    9382    9432  308574
  CBOT SOY OIL     MAR2   53.75    -0.32   53.70   54.10    5800
  NYMEX CRUDE      APR2  105.76    -0.49  105.65  106.41   15706
                                                                         
  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
  Crude in U.S. dollars per barrel
 	
 * Bursa Malaysia holds its annual Palm and Lauric Oils
Conference & Exhibition Price Outlook 2012 from March 5 to 7 in
Kuala Lumpur. For details, see www.pocmalaysia.com	
($1 = 3.0190 Malaysian ringgit)	
	
 (Editing by Miral Fahmy)