VEGOILS-Palm edges down on lower exports, Cyprus deal worries

Tue Mar 26, 2013 6:13am EDT

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* Investors cautious over lower export demand and Cyprus
    * Trading volume thin at 6,329 lots of 25 tonnes each
    * Malaysia's March 1-25 palm exports down 7-7.5 pct

 (Updates prices)
    By Chew Yee Kiat
    SINGAPORE, March 26 (Reuters) - Malaysian palm oil futures
edged lower on Tuesday in rangebound trading amid concerns over
lower export demand, while worries about the potential impact of
a Cyprus bailout scheme also dented investor appetite for
riskier assets.
    Cyprus's deal with international lenders to shut down the
country's second largest bank in return for 10 billion euros in
rescue funds removed the immediate risk of a financial meltdown,
but it also stoked fears of similar tough conditions for future
bank rescues in the euro zone. 
    Palm oil came under more pressure as Malaysian exports fell
by 7.5 percent for March 1 to 25 compared to a month ago due to
a slowdown in crude palm oil shipments.  
    "The market is stuck and it's looking for further direction.
We are looking at 2,400 ringgit for support," said a trader with
a local commodities brokerage in Malaysia.    
    By market close, the benchmark June contract on the
Bursa Malaysia Derivatives Exchange had lost 0.8 percent to
2,442 ringgit ($788) per tonne. Prices traded in a tight range
from 2,426 to 2,452 ringgit.
    Total traded volume stood at 22,264 lots of 25 tonnes each,
thinner than the usual 25,000 lots as most investors were
waiting for further trading cues.    
    Market players are counting on seasonally slower production
in Malaysia, the world's second-largest palm producer, to bring
stocks down this month. 
    Inventory level stood at 2.44 million tonnes in February
with leading analyst Dorab Mistry forecasting a drop below 2
million tonnes in June.  
    Traders are also looking out for export data for the full
month to see if demand is strong enough to offset imports and
production. A surprise drop in shipments for the first 25 days
of March due to lower exports to major buyers Europe and India
may continue to weigh on the market.      
    In other markets, Brent fell slightly, remaining within its
range of the past two weeks, as the effect of the Cyprus bailout
faded and traders saw little direction for the market. 
    In vegetable oil markets, U.S. soyoil for May delivery
 lost 0.2 percent in late Asian trade. The most-active
September soybean oil contract on the Dalian Commodities
Exchange closed 0.4 percent lower.    
  Palm, soy and crude oil prices at 1003 GMT
                                                                                   
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR3    2409   -19.00    2395    2410     115
  MY PALM OIL      MAY3    2426   -29.00    2418    2452    2006
  MY PALM OIL      JUN3    2442   -20.00    2426    2452   13481
  CHINA PALM OLEIN SEP3    6360   -76.00    6332    6414  512484
  CHINA SOYOIL     SEP3    8076   -34.00    8066    8126  516522
  CBOT SOY OIL     MAY3   50.31    -0.13   50.22   50.44    2955
  NYMEX CRUDE      MAY3   95.28    +0.47   94.67   95.30   14509
                                                                                   
  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=3.095 ringgit)   

 (Editing by Himani Sarkar)
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