KUALA LUMPUR, Oct 22 — Palm oil swung between gains and losses on concern that imports by China, the second-biggest buyer, may expand at the slowest pace in three years.
The contract for delivery in January fell and rose at least 0.2 per cent and was at RM2,438 (US$766) a metric tonne on the Bursa Malaysia Derivatives at 12:10pm in Kuala Lumpur.
Futures closed yesterday at RM2,437, the highest price for most-active futures since September 6. Palm for physical delivery in November was at RM2,420 yesterday, data compiled by Bloomberg show.
China’s inbound shipments in the 12 months that began October 1 are likely to remain about the same as the 6.6 million tonnes bought last year, according to a Bloomberg survey. Rising purchases of soybeans that are crushed to produce feed meal are also boosting the nation’s vegetable oil output at the expense of palm from exporters including Indonesia and Malaysia, Leon Xia, an analyst at Shanghai JC Intelligence Co, said yesterday.
“Malaysian palm oil is quite dependent on exports to China,” said Arhnue Tan, an analyst with Alliance Investment Bank Bhd. “If there is any slowing of exports, that could mean a build-up of supplies in Malaysia.”
Malaysia exported 17.6 million tonnes of palm oil last year, about 20 per cent of which went to China, data from the Malaysian Palm Oil Board shows.
World output will advance 5 per cent to 58.1 million tonnes, boosting stockpiles by 17 per cent to an all- time high of 9.2 million tonnes, according to the US Department of Agriculture.
Refined palm oil for May delivery declined 0.4 per cent to 6,132 yuan (RM3,203) a tonne on the Dalian Commodity Exchange and soybean oil retreated 0.7 per cent to 7,208 yuan.
Soybeans for delivery in January lost 0.3 per cent to US$12.97 (RM41.10) a bushel on the Chicago Board of Trade, while soybean oil for December fell 0.2 per cent to 41.57 cents a pound. — Bloomberg
