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VEGOILS-Palm posts longest winning streak since 2002, gains for 11th day

VEGOILS-Palm posts longest winning streak since 2002, gains for 11th day

· 03/17/2021 06:54
VEGOILS-Palm posts longest winning streak since 2002, gains for 11th day

Production expected to rise in Indonesia, Malaysia - trader

Malaysia keeps April export duty at 8%, raises reference price

Rally in agricultural prices seen temporary - economist

Recasts with closing prices, updates prices, adds quotes

By Mei Mei Chu

- Malaysian palm oil futures reversed early losses on Wednesday to record their longest winning streak since June 2002, climbing for an 11th consecutive day, as traders weighed forecasts for improved production against robust exports outlook.

The benchmark palm oil contract FCPOc3 for June delivery on the Bursa Malaysia Derivatives Exchange ended up 38 ringgit, or 0.98%, at 3,935 ringgit ($955.33) a tonne.

"Prices are up supported by fundamentals of low stocks and higher global vegetable oil complex," said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.

The market had declined slightly in early trade, as the Southern Peninsula Palm Oil Millers' Association forecast a large increase in March 1-15 production in Malaysia while Indonesia's output is also expected to rise, a Kuala Lumpur-based trader said.

Malaysia's exports to India have been robust this month and may keep March stocks unchanged, the trader added.

The world's second-largest palm exporter, kept its April export tax for crude palm oil at 8%. nK7N2FR027

Palm oil exports from Indonesia, the world's top producer, rose nearly 20% on an annual basis in January, the country's biggest palm group said, but output was disrupted by flood and stocks fell to a six-month low. nL1N2LF07B

Dalian's most-active soyoil contract DBYcv1 fell 1.5%, while its palm oil contract DCPcv1 declined 1.9%. Soyoil prices on the Chicago Board of Trade BOcv1 rose 0.4%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

"Agricultural prices have rallied since the middle of last year and this has sparked talk of a super cycle, but we anticipate that this latest rally will prove temporary," Samuel Burman, an assistant commodities economist at Capital Economics, said in a note.

Agricultural prices will fall as demand growth wanes and supply holds up as high prices and the return of migrant labour boosts production, he added.


($1 = 4.1190 ringgit)


(Reporting by Mei Mei Chu; Editing by Subhranshu Sahu and Vinay Dwivedi)

((Meifong.chu@thomsonreuters.com))

For a table on Malaysian physical palm oil prices, including refined oil, Reuters Terminal users can double click on or type OILS/MY01. * To view freight rates from Peninsula Malaysia/Sumatra to China, India, Pakistan and Rotterdam, please key in OILS/ASIA2 and press enter, or double click between the brackets.  * Reuters Terminal users can see cash and futures edible oil prices by double clicking on the codes in the brackets: To go to the next page in the same chain, hit F12. To go back, hit F11. Vegetable oils                       OILS/ASIA1 Malaysian palm oil exports           SGSPALM1   CBOT soyoil futures                  0#BO:      CBOT soybean futures                 0#S:       Indian solvent                       SOLVENT01  Dalian Commodity Exchange            DC/MENU   Dalian soyoil futures                0#DBY:   Dalian refined palm oil futures      0#DCP:   Zhengzhou rapeseed oil               0#COI:   European edible oil prices/trades    OILS/E