RSS
Twitter
Linked In
News In
News
Linked In
RSS
https://twitter.com/Agrimoney
http://www.newsnow.co.uk/h/Industry+Sectors/Agriculture

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

Rising Malay stocks send palm price to 1-year low

Twitter Linkedin

Palm oil futures dropped to a one-year low after data showing a slump in Malaysian palm oil exports this month added to pressure on values from statistics showing a surprise rebuild in the country's inventories.

Palm oil futures for October delivery touched 2,174 ringgit a tonne in Kuala Lumpur, the weakest for a benchmark contract since July last year, before closing at 2,177 ringgit a tonne, down 2.5%.

The decline followed the release of two sets of downbeat data, including from the Malaysian Palm Oil Board, which revealed Malaysia's inventories of the vegetable oil rising by 24,300 tonnes last month from June, to 1.68m tonnes.

Investors had forecast a drop of some 22,000 tonnes in inventories to 1.64m tonnes.

'Sharp tailspin'

The build in stocks reflected in part bigger-than-expected production, at 1.67m tonnes, up 6.1%, or nearly 100,000 tonnes, month on month - albeit in what is seasonally a strengthening period for output which typically peaks in October.

Earlier in the year, a dry spell, and the prospect for more assuming forecasts for an El Nino proved correct, raised concerns over output, although the waning chances of the weather pattern setting in have eased such fears for now.

"The lack of El NiƱo conditions is allowing for greater production, and this combined with strong North American soybean crop prospects as sent the market into a sharp tailspin," said Sterling Smith at Citigroup's Chicago office.

Malaysia's exports were a little softer than expectations in July, at 1.45m tonnes, falling nearly 35,000 tonnes month on month - although during a month which brought Ramadan, a period which can see strong demand ahead of the Muslim festival on inventory builds, but softer orders during it.

Soft start to August

However, hopes of a post-Ramadan pick-up in Malaysia's palm shipments were thrown into question when cargo surveyors showed a strong decline in volumes during the first 10 days of August.

Societe Generale de Surveillance estimated exports down 19.6% at 355,874 tonnes during the first 10 days of August, with particularly weakness in exports to China, down 61% at 43,100 tonnes.

On Sunday, rival Intertek Testing Services put the decline at 22%, to 347,094 tonnes, also highlighting a drop in volumes to China, which it estimated falling 43% to 63,300 tonnes.

By Agrimoney.com

Twitter Linkedin
Related Stories

Evening markets: Wheat futures tumble to contract low, on US export downturn

Weak US export sales data hurt wheat prices, while depressing soybean futures too. But cotton prices buck the trend

Ag commodity prices face further pressure, says SocGen, urging sell bets

The bank sees scope for forward prices of the likes of corn, cotton, hogs and wheat falling well below investor expectations

US soybean export sales fall short, but cotton stars again

Total US cotton export commitments are running 39% ahead of year-ago levels. But shippers may be wise to keep the champagne on ice for now

Details on Chinese agricultural commodity imports for October

Chinese customs data show jumps in imports of the likes of barley, rapeseed and wheat last month, but falls in sorghum and DDGs
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

© Agrimoney.com 2017

Agrimoney.com and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069