VEGOILS-Palm slips, posts worst annual loss since 2008

Mon Dec 31, 2012 5:16am EST

Related Topics

* Futures down 23 pct since start of year, steepest loss
since 2008
    * Malaysia's December exports down 5.7 pct -ITS
    * Exports down 7.9 pct for same period -SGS
    * Malaysia's new tax structure in focus for 2013 -trader
    * Malaysia's weather office upgrades heavy rain warning from
yellow to orange stage

 (Updates prices, adds SGS export data)
    By Chew Yee Kiat
    SINGAPORE, Dec 31 (Reuters) - Malaysian palm oil futures
fell on Monday, weighed by lower exports although losses were
limited by expectations that heavy rains in the world's No.2
producer may disrupt production and bring down record high
stocks. 
    Palm oil notched its worst annual performance since the
financial crisis in 2008, losing more than one-fifth thanks to
high stocks and a sluggish global growth that has dented edible
oil demand.
    For the coming year, traders are watching the impact of
Malaysia's zero export tax for crude palm oil in January and a
stricter import rule for edible oil to be enforced by China, the
world's second-largest edible oil buyer. 
    "Malaysia's new export duty will be tested. There are more
concerns on the tax structure because it is now an even
playground for both countries (Malaysia and Indonesia)," said a
dealer with a foreign commodities brokerage in Malaysia. 
    "I foresee an even fiercer price competition."
    Malaysian cargoes are still likely to be cheaper as it set
the January export tax rate at zero compared to Indonesia's 7.5
percent. 
    On the last trading day of the year, the benchmark March
contract on the Bursa Malaysia Derivatives Exchange
lost 2.6 percent to close at 2,433 ringgit ($796) per tonne. 
    Prices hit an intraday high of 2,517 ringgit per tonne -- a
level last seen on Nov. 2, prompting some traders to book
profits soon after.
    Total traded volumes stood at 43,399 lots of 25 tonnes each,
much higher than the usual 25,000 lots as traders squared their
positions. 
    Malaysian palm exports during December fell 5.7 percent to
1,568,510 tonnes from 1,663,092 tonnes a month ago, said cargo
surveyor Intertek Testing Services on Monday.    
    Another cargo surveyor, Societe Generale de Surveillance,
reported a steeper drop at 7.9 percent for the same period.
 
    Concerns of heavy rains in Malaysia disrupting supply
persisted after the weather office upgraded its warning on
Monday from yellow to orange stage for key producing states such
as Pahang and Johor.
    Brent crude slipped toward $110 per barrel on Monday, on
worries the United States may not reach a deal by Jan. 1 to
prevent a fiscal crisis that could erode fuel demand. 
    In competing vegetable oil markets, U.S. soyoil for March
delivery fell 0.6 percent in late Asian trade. The most
active May soybean oil contract on the Dalian Commodity
Exchange closed 0.4 percent lower.         
  Palm, soy and crude oil prices at 1012 GMT
                                                                        
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      JAN3    2320   -47.00    2305    2370     463
  MY PALM OIL      FEB3    2400   -51.00    2391    2470    2762
  MY PALM OIL      MAR3    2433   -64.00    2433    2517   14263
  CHINA PALM OLEIN MAY3    6922   -46.00    6916    7044  653958
  CHINA SOYOIL     MAY3    8612   -30.00    8608    8740  449196
  CBOT SOY OIL     MAR3   49.15    -0.28   49.03   49.70   10141
  NYMEX CRUDE      FEB3   90.72    -0.08   90.37   90.96    7815
                                                                        
  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
    ($1=3.058 ringgit)

 (Editing by Niluksi Koswanage)
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