Crude palm oil futures on Malaysia’s derivatives exchange fell Wednesday, dragged lower by declines in CBOT soyoil, but disruptive rainfall in Indonesia may limit the slide in prices.
The benchmark November contract on the Bursa Malaysia Derivatives exchange ended MYR36 lower at MYR2,610 a metric ton after sliding to a 1 1/2-week low of MYR2,592.
"It's still raining heavily in several areas of Kalimantan and some parts of Sumatra. (The heavy rain) will affect harvesting (cycles)," an executive at a Jakarta-based privately held plantation firm with estates in Kalimantan, Sumatra and Papua New Guinea said via telephone.
"Delivery (of palm fruits) has also been hampered by the rain," the executive said.
Sumatra and Kalimantan account for 97% of Indonesia's total palm production, and a supply disruption in the two regions may lead to a temporary shortage of oils, supporting prices.
"Palm prices may soon rally to MYR2,800-MYR2,900/ton due to the tightness of oils for nearby months," said a senior trading executive at a Kuala Lumpur-based brokerage.
Still, investors remained concerned that inventory levels may rise as exports had remained weak during the first 15 days of August.
Malaysia's palm oil exports fell 16% during the Aug. 1-15 period to 592,094 tons compared with the same period in July, cargo surveyor SGS (Malaysia) Bhd. said. Another surveyor, Intertek Agri Services, said exports during the period fell 7.4% on month to 619,435 tons.
In the cash market, many trades were reported, with palm olein for September traded at $930/ton up to $935/ton, November/December at $877.50/ton and January/February/March shipment from $862.50/ton to $875/ton, free-on-board Malaysian ports, said a Singapore-based physical market broker.
CME Group Inc.'s dollar-based November CPO futures were trading at $828.25/ton at 0946 GMT, down $13.50 from Tuesday's close.
Rupiah-denominated October CPO futures on the Indonesia Commodity and Derivative Exchange were 2.6% lower at IDR7,565 a kilogram at 0949 GMT.
Open interest on the BMD was 65,245 lots, versus 65,056 lots Tuesday. One lot is equivalent to 25 tons.
A total of 28,150 lots of CPO were traded versus 21,590 lots Tuesday.
Closing BMD Crude Palm Oil (CPO) futures prices in MYR/ton at 1000 GMT: Month Close Previous Change High Low Sep'10 2,735 2,770 Down 35 2,771 2,720 Oct'10 2,650 2,685 Down 35 2,686 2,639 Nov'10 2,610 2,646 Down 36 2,652 2,592 Dec'10 2,602 2,636 Down 34 2,645 2,583
-By Shie-Lynn Lim, Dow Jones Newswires; +603 2026 1233; shie-lynn.lim@dowjones.com
(END) Dow Jones Newswires
August 18, 2010 06:52 ET (10:52 GMT)
Copyright (c) 2010 Dow Jones & Company, Inc.
More Recent Palm Oil News 
- CPO Rises To Two Week High; Industry Data In Focus
- Crude Palm Oil Ends Up On Weekend Short Covering; Upside Limited
- Crude Palm Oil Recovers Late On Short Covering
- Crude Palm Oil Ends Down As Demand Prospects Weaken
- Crude Palm Oil Rises Slightly; Weak Demand Limits Upside
- Crude Palm Oil Ends Up On South America Crop Worries
- Crude Palm Oil Rises On Pre-Holiday Short-Covering
- Crude Palm Oil Falls Due To Bearish Export Outlook
- Crude Palm Oil Ends Higher On South America Weather
- Crude Palm Oil Ends Down On Profit Taking; USDA Report In Focus
- Crude Palm Oil Rises In Light Trade; USDA Data In Focus
- Crude Palm Oil Steady; South America Weather May Underpin
- Crude Palm Oil Ends Up In Light Trade; Fresh Cues Awaited
- Crude Palm Oil Ends Up On Weather Concerns; More Gains Likely
- Crude Palm Oil Ends Down On Profit Taking, Europe Worries
PRO Palm Oil Live Market News
- Asian Crude Palm Oil Ends Down On Profit-Taking; Industry Data In Focus
- Malaysian PM Cash Market Prices For Palm Oil – Feb. 9
- Malaysia Feb. 1-10 Palm Oil Exports Likely Reached 338,000 Tons -Executives
- *Malaysia Feb. 1-10 Palm Oil Exports Likely Reached 338,000 Tons -Executives
- China Dalian Commodity Exchange Grain Stocks, Feb 09
- BMD Crude Palm Oil (CPO) Rebounds But Higher Stocks Cap Gains
- China Dalian Grain Futures Closing Prices, Volume
- Malaysian AM Cash Market Prices For Palm Oil – Feb. 9
- BMD Crude Palm Oil (CPO) Falls With Other Commodities; Stocks Weigh
- BMD Crude Palm Oil (CPO) Slips In Choppy Trade; MYR3,120 Support
- BMD Crude Palm Oil (CPO) Tipped To Open Up But Upside Limited
- Asia-Pacific Commodities Events Calendar
- Southeast Asia Palm Oil Weather – Feb 8
- European Veg Oil PM Palm Oil & Lauric Oil Prices – Feb 8
- European Veg Oil AM Palm Oil & Lauric Oil Prices – Feb 8
