KUALA LUMPUR (Dow Jones)–Crude palm oil futures on Malaysia’s derivatives exchange ended off lows Tuesday, supported by expectations that demand may improve in coming weeks amid soyoil production deficits.
Failed budget talks that resulted in the collapse of the Dutch government stoked fresh fears about Europe’s political problems, leading to a brief selloff in regional equities and commodities in early trade.
The benchmark July contract on the Bursa Malaysia Derivatives exchange ended 0.3% lower at MYR3,463 a metric ton, after tumbling as much as 0.8% to MYR3,448/ton.
May soyoil on the Chicago Board of Trade was 0.4% higher at 55.32 cents a pound as of the end of trade on the BMD.
In afternoon trade, the market shrugged off fears over global economic growth to focus on talk that April 1-25 export demand may recover with a modest 3% drop in outbound sales of 1.37 million tons, compared with a 5% fall during the April 1-20 period.
“We think the market will trade within narrow ranges in the next few days even though export demand appears to be on the mend. Market sentiment remains cautious due to disappointing economic data in Europe and political uncertainties in the region,” a trading executive in Jakarta said, tipping the market to move in a MYR3,430-MYR3,510/ton range in coming sessions.
Cargo surveyors Intertek Agri Services and SGS (Malaysia) Bhd. are expected to issue April 1-25 palm oil export estimates Wednesday.
The tropical oil also received a boost from tighter global vegoil supplies, as limited availability of soyoil could shift demand to cheaper palm oil, analysts said.
In the cash market, refined palm olein for May was offered at $1,160/ton while cash CPO for prompt shipment was offered at MYR3,480/ton.
Open interest on the BMD was 122,096 lots, versus 122,092 lots Monday. One lot is equivalent to 25 tons.
A total of 17,378 lots of CPO were traded versus 26,203 lots Monday.
Resistance Watch This Area :3486 3504 3521 3538
Still No Major Signal On Daily... Just A Retracement... So Ready For So Moolah :D
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