In The News - 15/11/2005
Malaysia's crude palm oil futures closed lower on Tuesday, weighed down by a drop in rival soyoil prices and export data for the first half of November.
The benchmark third-month January contract <KPOF6> on Bursa Malaysia Derivatives ended down 7 ringgit at 1,422 ringgit ($376.19) a tonne.
Overall volume increased to 4,855 lots of 25 tonnes each, from Monday's 2,186 lots.
"The shipment numbers have improved over the last 5 days but people still aren't impressed," said a trader. "That's why the prices haven't moved up."
Cargo surveyor Societe Generale de Surveillance (SGS) said on Tuesday Malaysian exports of oil palm products for Nov. 1-15 are estimated to have fallen 16.7 percent to 533,521 tonnes from 640,553 tonnes tracked for Oct. 1-15.
SGS had estimated a 40 percent drop in shipments for the first 10 days of the month due to a long holiday for Deepavali and Eid al-Fitr festivities.
Soyoil futures on the Chicago Board of Trade saw double-digit losses on Monday, although contracts for the nearby months of December and January recovered slightly in Tuesday's electronic session conducted during Asian hours <0#ZL:>.
Soyoil competes with palm oil for exports and their prices often move in step.
Soybean futures at the Chicago Board of Trade closed lower on Tuesday after a choppy, lightly traded session with few fresh leads to stir much market direction, traders said.
Resurrected concerns about ample soybean supplies cast a bearish tone to trading after a large U.S. harvest and early outlooks for a good growing season in South America, especially after Argentina received beneficial rains this week.
Also bearish was the lagging U.S. export pace from a year ago as global buyers were finding old-crop supplies from South America still available, traders said.
January soybeans <SF6> closed 2-3/4 cents lower at $5.92-1/4 per bushel. The deferreds were down 1-3/4 cent to up 1/2 cent.
Underpinning prices were firm U.S. cash markets due to slow farmer sales.
Traders have turned their attention to South American weather and the development of young plants as the U.S. harvest was complete. In particular, traders are focusing on Argentina where soybeans need moisture for emergence and early growth.
Rains fell across the soybean growing areas of Argentina in the past day. Dry conditions or just a few light showers during the next two days is expected with another round of rain forecast for Thursday.
Brazil was mostly dry on Monday. Showers were expected by later this week.
Deliveries on the expired November contract totaled 229 lots. A customer of R.J. O'Brien delivered 165 lots and an O'Brien customer also was the key stopper of 204.
Registrations with the CBOT sagged to 1,770 lots from the previous 1,790.
CBOT soymeal futures closed mixed and range-bound. December soymeal <SMZ5> was unchanged at $180.20 per ton, with the deferreds 70 cents lower to 70 cents higher.
The soyoil market was the weakest of the complex on lingering concerns about big U.S. soyoil stocks as reported by the National Oilseed Processors Association on Monday. The weakness in vegetable oil prices in Europe added to the soft tone, with all markets under pressure by prospects that the new German government will end special tax breaks for biodiesel.
Vegetable
oils are the main ingredient used to produce biodiesel. In the United States,
roughly 90 percent of all biodiesel is made from soybean oil.
December
soyoil <BOZ5> closed 0.17 cent lower at 22.34 cents, with deferreds down
0.06 to 0.18 cent.
Malaysian
palm oil futures closed mostly lower overnight, pressured by a drop in rival
soyoil prices and export data for the first half of November, traders said.
Trade
data released by the Commodity Futures Trading Commission late Monday showed
that large speculators remained long in CBOT soybeans and soyoil futures and
options as of last Tuesday -- increasing their net longs in soybeans and
decreasing their net longs in soyoil. In soymeal, speculators reduced their net
short position in futures/options combined.
Commodity
funds sold 1,000 soybean contracts, 1,500 soyoil and were about even in soymeal,
traders said.
Volume
was light across the complex. Estimated soybean trade was 41,756 futures and
17,425 options. In soymeal, volume was estimated at 19,678 futures and 1,418
options. Soyoil trade was estimated at 27,247 futures and 3,877 options.
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