Malaysian crude palm oil futures rebounded from losses to end higher on Thursday, lifted by speculative buying and firmer prices of rival US soyabean oil. Fears over declining exports and rising supplies had weighed on the market, dealers said.
The benchmark September contract on the Bursar Malaysian Derivatives Exchange closed up 11 ringgit at 2,388 ringgit ($692) a tonne after touching an intra-day low of 2,354. "Production could outpace demand sooner than expected," said one trader. "Soyaoil is supportive but only to an extent." Dealers said production had started to increase at a faster rate in the second half of June compared with exports, which were steadily declining.
Palm oil is nearly 14 percent off a high of 2,764 ringgit reached this month. Other traded months was up 25 ringgit to down 19 ringgit. Overall trade was 11,384 lots of 25 tonnes each. September palm oil on Singapore's Joint Asian Derivatives Exchange shed $5.00 at $690.25 a tonne while distant months were firmer in light trade.
Soyabean oil futures on the Chicago Board of Trade rose in electronic trading during Asian hours. The July contract gained 0.10 cent to 35.41 cents a lb. Soyaoil competes with palm oil due to common use in products ranging from lipstick and bread to bifocals. Exports of Malaysian palm oil products for June 1-20 fell 15 percent to 661,626 tonnes from 775,979 tonnes shipped between May 1 and 20, cargo surveyor Interlake Testing Services said on Wednesday.
Another surveyor, Society General de Surveillance, said exports during the period fell 15.5 percent to 675,424 tonnes. In Malaysia's physical market, crude palm oil for June shipment in the southern region was quoted at 2,500/2,530 ringgit a tonne. Trades were done between 2,500 and 2,530 ringgit.
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