* Investors focus on impact of zero export tax, Jan export
* Palm oil seen retracing to 2,452 ringgit -technicals
* Prices should trade in a range of 2,450-2,550 ringgit
(Updates prices, adds detail)
By Chew Yee Kiat
SINGAPORE, Jan 3 Malaysian palm oil futures
edged lower on Thursday after prices climbed to a two-month high
the previous day, although hopes of a new export tax structure
boosting demand had curbed losses.
The tropical oil started the year strongly by jumping to its
highest since Nov. 2 on Wednesday after the United States
reached a fiscal deal that prevented the world's largest economy
from slipping into recession.
Market players are eyeing Malaysia's Jan. 1-10 exports data
due next week, expecting higher demand from crude palm oil as
the country imposed a zero percent duty in January for shipments
of the grade.
"We see a bit of profit-taking coming in. Every time we go
above 2,500 ringgit, there's no strong follow through," said a
trader with a foreign commodities brokerage in Malaysia.
"The important issue now is with the new export tax
structure and traders want to see how Malaysian exports will be
for the first 10 days. Prices should be trading in a range of
At market close, the benchmark March contract on
the Bursa Malaysia Derivatives Exchange fell 1.0 percent to
2,475 ringgit ($816) per tonne. Prices hit a two-month high of
2,524 ringgit on Wednesday.
Total traded volumes stood at 36,244 lots of 25 tonnes each,
higher than the usual 25,000 lots.
Technicals appear to be bearish as palm oil is expected to
retrace to 2,452 ringgit based on a wave analysis, Reuters
market analyst Wang Tao said.
But prices may find support as lower December production and
disruption to supply due to heavy rains could help ease
record-high stocks of 2.56 million tonnes, traders said.
Industry regulator the Malaysian Palm Oil Board will release
official data on December's stocks and output next week.
Investors are monitoring the impact of China starting to
enforce its quality standards on edible oil imports. Palm oil
which fails to make the grade could see cargoes turned away from
Chinese ports, depressing demand a little.
Brent crude dropped below $112 a barrel on Thursday as the
prospects of more budget battles in the United States and rising
oil supply weighed on prices, although upbeat economic data from
China limited losses.
In competing vegetable oil market, U.S. soyoil for March
delivery fell 0.2 percent in late Asian trade. China's
Dalian Commodities Exchange is closed for the New Year holiday
and will resume trading on Friday.
Palm, soy and crude oil prices at 1007 GMT
Contract Month Last Change Low High Volume
MY PALM OIL JAN3 2364 -18.00 2350 2371 296
MY PALM OIL FEB3 2439 -18.00 2422 2460 6173
MY PALM OIL MAR3 2475 -26.00 2467 2513 20208
CHINA PALM OLEIN MAY3 6922 -46.00 6916 7044 653958
CHINA SOYOIL MAY3 8612 -30.00 8608 8740 449196
CBOT SOY OIL MAR3 50.96 -0.09 50.88 51.29 6154
NYMEX CRUDE FEB3 92.57 -0.55 92.49 92.98 11020
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
(Editing by Niluksi Koswanage)