VEGOILS-Palm oil edges lower as euro zone worries trigger selloff

Mon Mar 18, 2013 6:30am EDT

Related Topics

* Radical bailout plan prompts fresh euro zone fears
    * Palm oil to revisit low of 2,360 ringgit -technicals
    * Malaysia's March 1-15 exports up 4.6 pct m/m -SGS

 (Updates prices)
    By Chew Yee Kiat
    SINGAPORE, March 18 (Reuters) - Malaysian palm oil futures
edged lower on Monday, as traders turned cautious after a
radical bailout proposal for Cyprus rattled investors and
triggered a broad-based decline in commodities and financial
markets.
    Euro zone finance ministers asked Cyprus savers to forfeit a
portion of their deposits in return for a 10 billion euro ($13
billion) bailout for the island, sparking fears of fresh turmoil
in the euro zone and worries about global demand.
    
    "It seems like Europe is back to the headlines for the wrong
reasons," said Ker Chung Yang, investment analyst with Phillip
Futures in Singapore. "We have probably seen the last of the
rally last week, and this week could be the beginning of a
downturn or corrections in the commodities market."        
    The benchmark June contract on the Bursa Malaysia
Derivatives Exchange fell 1.4 percent to close at 2,383 ringgit
($761) per tonne, also its low for the day. Prices traded in a
tight range between 2,383 to 2,415 ringgit.  
    Total traded volume stood at 27,137 lots of 25 tonnes each,
slightly higher than the usual 25,000 lots.
    Technical analysis indicates Malaysian palm oil is expected
to revisit its March 14 low of 2,360 ringgit per tonne, as a
rebound from this level has completed, said Reuters market
analyst Wang Tao. 
    Palm oil futures also continued to come under pressure from
a weak soy market, which is suffering from poor U.S. demand and
higher South American supply, losing 1.4 percent last week.
 
    But seasonally lower output in Malaysia may help ease palm
oil stocks and support prices, especially after cargo surveyor
data on Friday showed firm export demand. 
    Malaysian palm oil shipments for the first half of the month
were slightly better compared to the same period last month,
with cargo surveyors Intertek Testing Services and Societe
Generale de Surveillance reporting a 0.2 and 4.6 percent
increase respectively.        
    In other markets, crude oil dropped to below $109 a barrel
on Monday as stock markets tumbled and the dollar strengthened
on the bank bailout proposal for Cyprus.   
    In other vegetable oil markets, U.S. soyoil for May delivery
 lost 0.8 percent in late Asian trade. The most-active
September soybean oil contract on the Dalian Commodities
Exchange also dropped 0.4 percent.
       
  Palm, soy and crude oil prices at 1005 GMT
                                                                                          
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR3    2386   -20.00    2382    2402     350
  MY PALM OIL      MAY3    2386   -28.00    2383    2415    6620
  MY PALM OIL      JUN3    2383   -34.00    2383    2415   12142
  CHINA PALM OLEIN SEP3    6276   -44.00    6220    6346  542104
  CHINA SOYOIL     SEP3    8050   -30.00    8006    8084  599994
  CBOT SOY OIL     MAY3   49.51    -0.40   49.30   49.94    6584
  NYMEX CRUDE      APR3   92.64    -0.83   92.14   93.26   24748
                                                                                          
  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=3.13 ringgit)    

 (Editing by Richard Pullin and Tom Hogue)
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