Wednesday, December 5, 2012

The benchmark February contract at Bursa Malaysia Derivatives ended 0.4% lower

Crude palm oil futures on Malaysia's derivatives exchange edged lower Wednesday after choppy trade over investor concerns about ample palm oil stockpiles and inconclusive U.S. fiscal cliff talks.
The benchmark February contract at Bursa Malaysia Derivatives ended 0.4% lower at 2,284 ringgit a metric ton, after seesawing between positive and negative territories.
"Sentiment remains weak as palm oil inventory in November has probably hit another record high. From a technicals perspective we expect palm oil to aim for MYR2,200/ton as the market closed below the key psychological level MYR2,300/ton," a trading executive at a foreign brokerage said.
Market participants said end-November stockpiles probably reached 2.55 million-2.60 million tons, surpassing October's 2.51 million tons. The Malaysian Palm Oil Board issues November crop data on Monday.
Still, some industry players expect palm oil shipments to surge by the end of December, as exporters with overseas refineries are moving more cargoes before a duty-free CPO export quota is discontinued.
In the cash market, refined palm olein for December shipment was offered at $772.50/ton, while cash CPO was offered at MYR2,080/ton.
Open interest on the BMD was 175,484 lots, versus 181,015 lots Tuesday. One lot is equivalent to 25 tons.
A total of 34,987 lots of CPO were traded versus 41,296 lots Tuesday.
Ending BMD CPO futures prices in MYR/ton: 
Month   Close  Previous  Change   High    Low 
Dec'12  2,112     2,100      12  2,129  2,112 
Jan'13  2,208     2,218     -10  2,231  2,197 
Feb'13  2,285     2,294      -9  2,312  2,275 
Mar'13  2,350     2,357      -7  2,375  2,340 

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