March 29, 2013 / 10:32 AM / 5 years ago

VEGOILS-Palm edges lower, posts 4th straight quarterly loss

* Palm oil prices slip to 2,376 ringgit, lowest since March
    * Prices fell 2.5 pct in Q1
    * USDA soybean stocks bearish for palm oil -analyst

 (Updates prices, adds details)
    By Chew Yee Kiat
    SINGAPORE, March 29 (Reuters) - Malaysian palm oil futures
slipped to the lowest in two weeks on Friday to record a fourth
straight quarterly drop, after data showed higher-than-expected
U.S. soybean stockpiles.
    The U.S. Department of Agriculture pegged soybean stocks at
999 million bushels, above trade guesses of 935 million. Higher
soybean stocks for crushing into soybean oil may shift some
demand away from competing palm oil. 
    Palm oil prices also came under pressure ahead of export
data next week that traders will scour for clues on whether
demand is strong enough to whittle down high stockpiles in
Malaysia, the second-largest producer.
    "Overall, the news of significantly higher-than-expected
U.S. soybean stockpiles but slightly lower than expected soybean
planting acreage is negative to crude palm oil (CPO) prices due
to its strong correlation with soybean oil prices," Alan Lim
Seong Chun, research analyst with Malaysia's Kenanga Investment
Bank, said in a note to clients on Friday. 
    "Nevertheless, we think that CPO prices' downside is limited
as we expect a CPO seasonal demand recovery in the near term due
to warmer weather in the northern hemisphere."     
    The benchmark June contract on the Bursa Malaysia
Derivatives Exchange lost 1.4 percent to 2,378 ringgit ($768)
per tonne by Friday's close. Prices earlier fell to 2,376
ringgit, the lowest since March 15. 
    Total traded volume stood at 19,429 lots of 25 tonnes each,
slightly thinner than the usual 25,000 tonnes.
    The edible oil ended the first quarter of the year 2.5
percent lower as high stocks in top producers Indonesia and
Malaysia weighed, although easing inventory levels should
provide support for prices in the coming months.
    Stockpiles in Malaysia hit a record 2.63 million tonnes in
December but have since gradually eased to 2.44 million tonnes
in end-February. Market players are expecting March export data
due on Monday to gauge how much demand will eat into stocks.
    "Investors are waiting for Monday's full month export
figures. At least then there is a clue as to where stocks will
be heading to," said a trader with a foreign commodities
brokerage in Malaysia.
    In other vegetable oil markets, the most-active September
soybean oil contract on the Dalian Commodities Exchange
fell 1.7 percent in late Asian trade.
    The Brent crude futures markets and the U.S. soybean markets
were shut for the Good Friday holiday.    
  Palm, soy and crude oil prices at 1011 GMT
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR3    2345   -27.00    2345    2365      79
  MY PALM OIL      MAY3    2371   -30.00    2367    2393    2217
  MY PALM OIL      JUN3    2378   -34.00    2376    2402    8348
  CHINA PALM OLEIN SEP3    6246   -82.00    6102    6266  586028
  CHINA SOYOIL     SEP3    7932  -138.00    7822    7976  685892
  CBOT SOY OIL     MAY3   50.00    -0.82   49.52   50.95   69815
  NYMEX CRUDE      MAY3   97.23    +0.65   96.26   97.35  160072
  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)   

 (Additional reporting by Anuradha Raghu; Editing by Himani
Sarkar, John Stonestreet)

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