Monday, July 18, 2011

20110718 1829 FCPO EOD Daily Chart Study.

FCPO closed : 3078, changed : -37 points, volume : higher.
Bollinger band reading : correction range bound little downside biased.
MACD Histrogram : turned lower, buyer reducing exposure.
Support : 3070, 3050, 3020, 2970 level.
Resistance : 3100, 3150, 3200, 3250 level.
Comment :
FCPO closed recorded loss with higher volume exchanged while soy oil last Friday closed marginally higher and currently trading lower.
Concern on higher supply and uncertain global economic growth leaded soy oil, crude oil and crude palm oil to trade lower.
Daily chart formed a down bar candle with small upper and lower shadow closed near middle Bollinger band level after market opened little higher, edge upwards slightly and plunged downwards followed by 2nd session traded range bound to closed near the low of the day.
FCPO is likely to trade in a correction range bound little downside biased market development for the near term testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110718 1809 FKLI EOD Daily Chart Study.

FKLI closed : 1561 changed : -19 points, volume : higher.
Bollinger band reading : side way range bound.
MACD Histrogram : falling, seller taking position.
Support : 1550, 1540, 1530, 1515 level.
Resistance : 1565, 1570, 1580, 1590 level.
Comment :
FKLI closed recorded severe loss with better volume change hand doing 1.5 point discount compare to cash market that also closed lower while Asia markets ended mostly lower and European markets continue to trading in negative territory with last Friday U.S. market continue to closed higher.
No ending European sovereign debt issue and near deadline unsettle U.S. debit ceiling problem that could lead to a possible U.S. default triggered investor to reduce exposure and stay sideline avoiding potential risk.
Daily chart formed a wide range down bar candle closed near lower Bollinger band level after market lower, followed by selling pressure pressed price to moved downwards all the way towards the end to closed at the low of the day.
Technical reading turned to suggesting a side way range bound market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20110718 1729 Global Market & Commodities Related News.

Gold shines on a gloomy day as risk aversion spreads
HONG KONG, July 18 (Reuters) - Gold and the Swiss franc hit record highs on Monday while equities and the euro tumbled as the lack of any breakthrough to the escalating debt crisis in the euro zone and the United States sapped demand for risky assets.      
"Investors are gradually losing confidence as the U.S. debt ceiling date nears and even though we expect a last-minute deal to materialise, this kind of behaviour is making markets very nervous," said Adrian Foster, head of financial markets research -Asia Pacific at Rabobank International in Hong Kong.

US corn falls over 1 pct, wheat down on Russian supplies
SINGAPORE, July 18 (Reuters) - U.S. corn slid more than 1 percent on Monday, weighed down by concerns over U.S. and European debt, after strong gains last week on forecasts of hot weather which could threaten crop yields.
"The dollar is trading higher and that seems to be playing out so far today," said Luke Mathews, commodity strategist at Commonwealth Bank of Australia.

Herakles lands $350 mln Cameroon palm oil deal
YAOUNDE, July 17 (Reuters) - New York-based agricultural company Herakles Farms will develop some 60,000 hectares of oil palm plantations in Cameroon's    south-west region, project manager Delilah Rothenberg told Reuters in an interview.  
"We are developing approximately 60,000 hectares of oil palm plantation, and expect the total capital costs to be about $350 million, to be invested over several years," she said of the result of a land lease deal signed with the government.

China's autumn grain harvest to be "satisfactory" -media
SHANGHAI, July 16 (Reuters) - China is expecting a "satisfactory" harvest of autumn grains provided there are no major natural disasters, an official with the country's economic planning agency said, according to state media reports on Saturday.
Analysts and grain traders are watching for signs of whether China will increase its imports of corn and other grains to add to its stockpiles, after buying as much as 5 million tonnes of corn since March.

China buys 10 pct of Vietnam sugar sales, to take more-report
HANOI, July 16 (Reuters) - China has bought around 100,000 tonnes of Vietnamese sugar, nearly 10 percent of the country's sales from its latest crushing season, and imports are expected to continue in coming months, a state-run newspaper reported on Saturday.
"Inflation in China has now shown signs of easing, so sugar exports are likely to rise in the time ahead," the official Tuoi Tre (Youth) newspaper quoted experts as saying at an industry meeting that reviewed sugar production.

Brazil coffee stocks 4 mln bags by July 1-exporter
BRASILIA, July 15 (Reuters) - Brazil had just over 4 million bags of private and public coffee stocks as of July 1, exporter Comexim estimated on Friday, expecting rising local consumption to leave tight supplies by that date next year.
The exporter, based near the main coffee port in Santos, estimated Brazil had less than 28 million 60-kg bags of private stocks and 2.1 million bags of older public stocks in its warehouses by Jan. 1 this year, in the interharvest.

Brent crude falls on U.S., Europe debt worries
SINGAPORE, July 18 (Reuters) - Brent crude dipped below $117 a barrel on Monday as the ongoing debt crises in Europe and the United States kept skittish investors away from risky assets, while the possibility of a second IEA oil release also weighed on sentiment.
"It is too early for the IEA to release stocks for the second time within such a short time," said Serene Lim of ANZ bank.

Germany, Italy may resist 2nd IEA oil release
PARIS, July 15 (Reuters) - Germany and Italy are expected to oppose any second release of emergency oil reserves by the International Energy Agency, which needs the backing of all 28 members if it is to pour more oil on a volatile crude market.
The IEA is expected to confer with its member countries by July 23 to decide whether to draw further on emergency oil stocks after its announcement last month of a 60 million-barrel release, only the third such move in its history.

LME copper ticks up; economy, debt woes cap gains
SINGAPORE, July 18 (Reuters) - Copper edged higher on Monday, supported by near-term supply risks although a cloudy outlook for global demand limited gains.
"Even if some market participants see good value in buying at current levels, this litany of downside risks appears to be tempering price growth," said Ben Westmore, commodity economist at National Australia Bank.

Niger president seeks more value from uranium price
NIAMEY, July 17 (Reuters) - Niger, a major supplier of uranium to the French nuclear sector, wants a better price for its supplies, President Mahamadou Issoufou told state TV.
Issoufou, who came to power after March elections that ended just over a year of military rule, said the poor desert state was determined to make the most of its resources.

Afghanistan extends deadline for iron ore bids
KABUL, July 16 (Reuters) - The deadline for bids for Afghanistan's giant Hajigak iron ore  deposit has been extended by a month to Sept. 4 at the request of companies interested in the project, the country's mines minister said on Saturday.
The Hajigak project, which straddles the central provinces of Bamiyan, Parwan and Wardak, has deposits of 2 billion tonnes with an estimated worth of $350 billion and is described by the Afghan government as Asia's largest unmined iron deposit.

Cuban nickel plant offline after breakdown
HAVANA, July 15 (Reuters) - Cuba's second most important nickel plant broke down this week and will apparently be offline for a while, according to media reports in eastern Holguin province where the industry is located.
"The Che Guevara nickel plant in Moa stopped activity due to a breakdown," Holguin provinces' state-run Tele Cristal reported on Thursday, without providing further details.

India's NALCO says cuts aluminium prices by $67.4/T
BHUBANESHWAR, India, July 15 (Reuters) - State-run National Aluminium Co Ltd (NALCO) , India's No. 3 producer of aluminium, has further cut aluminium prices by 3,000 rupees ($67.4) a tonne in the local market following a drop in global prices, a top company official said on Friday.
The revision, which is effective immediately, reflects the changes in London Metal Exchange (LME) rates, NALCO's commercial director Ansuman Das told Reuters.

China 2010 steel output underreported by 45 mln T-report
SINGAPORE, July 18 (Reuters) - China's crude steel output reached 672 million tonnes in 2010, 45 million tonnes more than what was reported by the Chinese government, the Financial Times reported on Monday, citing figures from a UK steel consultancy.
China's National Bureau of Statistics said domestic crude steel production hit a record 627 million tonnes last year.  

Gold hits record high on U.S., Europe debt worries
SINGAPORE, July 18 (Reuters) - Spot gold touched a record high on Monday, reflecting persistent worries about the euro zone debt crisis and a growing threat of a U.S. government default.
"The political uncertainties in the United States and Europe will be an ongoing theme and safe-haven demand will continue," said Natalie Robertson, a commodities analyst at ANZ.

20110718 1725 Global Market & Commodities Related News.

GLOBAL MARKETS: Stocks, euro struggle as investors turn risk-averse
HONG KONG, July 18 (Reuters) - The euro and the U.S. dollar slipped to record lows against the Swiss franc on Monday while equities struggled to stay in positive territory as the ongoing debt crises in the U.S. and the euro zone kept investors from adding to their risky assets.        
With policymakers on both sides of the Atlantic offering no clear solutions to the markets on their respective debt problems, risk-averse investors are expected to continue piling up perceived safe-haven instruments like gold -- which hit a record high on Monday -- and bonds.

OIL: Oil rises on lower Canadian supply, equities
NEW YORK, July 15 (Reuters) - Oil rose on Friday on lower supplies for a Canadian export pipeline and Wall Street's advance on favorable results of a stress test on European banks, which offset a rash of weak U.S. economic data.
"There is pre-weekend short-covering going on as nobody wants to be short at this time with so many things going on," said Phil Flynn, analyst with PFBEST Research in Chicago.

NATURAL GAS: Natural gas ends up 4 pct, front breaks resistance
NEW YORK, July 15 (Reuters) - U.S. natural gas futures ended sharply higher on Friday, with forecasts for another heatwave next week in the Northeast and Midwest driving the front-month contract above key technical resistance.
"It's supposed to be beastly hot again next week, and the heat is more than offsetting a loose supply-demand balance, but I'd caution against getting too excited," said Steve Mosley at SMC Advisory Services, a commodity trading advisory firm in Arkansas.

EURO COAL: Sep DES ARA trades at $122.75/T
LONDON, July 15 (Reuters) - Prompt physical coal prices remained stable on Friday with few trades seen or fresh news to give the market clear direction, traders and utilities said.
"Volumes have stayed very low and coal's just kept following oil but there are fewer key players active in the market this week," one European utility source said.

COMMODITIES: Heat boosts ags, energy; gold gains on debt fears
NEW YORK, July 15 (Reuters) - Most major commodities rose on Friday, reversing the previous session's losses, as forecasts for hot weather drove up energy and agriculture prices and mounting fears about debt defaults lured investors into gold.
Still, investors kept one eye on tense negotiations between U.S. political parties over raising the U.S. debt limit, ahead of a possible Aug. 2 default.

Iran to export 2.6 mln litres of gasoline per day
TEHRAN, July 17 (Reuters) - Iran said on Sunday it would export 2.6 million litres of gasoline per day due to a rise in production and fall in consumption, an official was quoted as saying by the semi-official Fars news agency.
"Considering the country's gasoline production capacity has increased to 70 million litres per day and consumption dropped to around 54 million, it is now possible to export 2.6 million," said Ali-Reza Zeighami, the head of the state-owned National Iranian Refining and Distribution Co.

Bangladesh to spend $6.17 bln on oil imports
DHAKA, July 17 (Reuters) - Bangladesh will spend $6.17 billion on importing oil in the 2011-12 fiscal year, more than double the previous year, as it  buys more fuel at higher cost to fire up new power plants aimed at easing electricity shortages, a senior energy official said.
"This year (July-June) the state-run Bangladesh Petroleum Corporation (BPC) will import 7.03 million tonnes of fuel oil, up from 5.4 million in 2010-11," BPC chairman Mohammad Muqtadir Ali told Reuters on Sunday.

Japan power sector oil demand may triple as nuclear output falls
SINGAPORE, July 15 (Reuters) - Japan's demand for crude and oil products to fuel power plants could triple if the country shuts all its nuclear reactors due to growing public safety concerns after the March earthquake and tsunami.
The country's energy policy was left in tatters after the quake caused the worst nuclear accident in 25 years. Japan had planned to increase nuclear power supply to meet 50 percent of demand, from 30 percent before the quake. Now, Prime Minister Naoto Kan is talking about a nuclear-free future.

Libya rebels fighting to capture eastern oil town
MISRATA, Libya, July 17 (Reuters) - Libyan rebel forces on Sunday entered the oil town of Brega and fought street battles there with forces loyal to Muammar Gaddafi, a rebel spokesman said, in the biggest offensive in eastern Libya in weeks.    
"The news coming from there is there is a street war going on between Gaddafi troops and the rebels, and 127 are wounded from our side," Abdulrahman Busm, an official in the rebel National Transitional Council, said by telephone.

20110718 1121 Malaysia Corporate Related News.

Kurnia Asia looking to dispose of insurance arm
Kurnia Asia Bhd is looking to dispose of its insurance business and has  already attracted several interested parties, sources say. Its insurance arm,  Kurnia Insurans (M) Bhd, is ranked  among the top five players in the  general insurance space, and interest in the business is not surprising,  considering the slew of mergers and acquisitions (M&A) taking place in the  industry. (The Edge Weekly)

Nizam Razak likely to surface at Petra Energy
As Kencana Petroleum Bhd and SapuraCrest Petroleum Bhd steps towards  a merger, something appears to be brewing at smaller integrated oil and  gas (O&G) services provider, Petra Energy Bhd. Sources say Datuk  Mohamed Nizam Razak, who is Prime Minister Datuk Seri Najib Razak’s  younger brother, is set to emerge as a substantial shareholder in Petra  Energy as the group undertakes a private placement. (The Star)

Hibiscus raises RM235m from IPO which is oversubscribed
Main Market-bound Hibiscus Petroleum Bhd has raised a total of RM235m  from its initial public offering (IPO) and enjoyed 3.8 times oversubscription  of its public portion of shares. However the public portion only represented  a mere 3% of its IPO shares. The bulk of the IPO proceeds came from a  placement of 265m new Hibiscus shares to selected investors, which raised  a total of RM199m. The IPO price of Hibiscus shares is 75 sen per share.  (The Star)

Maxis sees higher data segment revenue
Maxis Bhd expects to see a higher revenue contribution from its data  segment in the coming years compared with the current 40%, given the rise  in data use by its customers whether on smartphones or tablets. Chief  Operating Officer Jean-Pascal Van Overbeke said Malaysians currently  used data in every way that they can, even with a normal mobile phone.  (Business Times)

Bursa reprimands Goodway
Bursa Malaysia Bhd has reprimanded Goodway Integrated Industries Bhd  for its failure to announce to the bourse its annual audited financial  statements together with the auditors' and directors' reports within a period  of not more than four months from the close of its financial year. (The Star)

Century buys Indonesian IT firm
Century Software Holdings Bhd has signed a sale and purchase agreement  to acquire a 60% stake in P.T. Praisindo Teknologi for RM4.35m. The stake  will be acquired from Praisindo Teknologi's existing major shareholder, P.T.  Mahaka Media Tbk, a listed entity on Jakarta Stock Exchange. The  remaining 40% stake in Praisindo  will be held by its management team.  (The Star)

MAS to pay US$3.35m to US freight forwarders
Malaysian Airline System Bhd (MAS) is paying US$3.35m to some freight  forwarders in the US to settle the air cargo litigation. MAS said on Friday,  July 15 that it had on July 11 entered into a settlement agreement with the  freight forwarders in the US. (The Edge)

Primus set to re-appeal
Primus (M) Sdn Bhd is seeking leave to appeal against the Court of  Appeal's earlier decision which unanimously dismissed its two appeals with  costs involving matters related to the RM5.06b disposal of the assets and  liabilities of EON Capital Bhd (EON Cap) to Hong Leong Bank Bhd (HLB).  The announcement was made by EON Cap yesterday to Bursa Malaysia.  (The Star)

Maybank, Amex partner MAS to launch credit card for SMEs
Maybank, Malaysia Airlines and American Express have collaborated to  launch a co-branded credit card - MAS American Express Business Card -  dedicated to business travelers among the small- and medium-sized  enterprises (SMEs). The latest addition to the Maybank and American  Express family of cards is expected to attract 30,000 new members within  three years. (Business Times)

UOA REIT 2Q net profit up 62% to RM10.68m
UOA Real Estate Investment Trust’s  net profit rose 62% to RM10.68m in  the second quarter ended June 30, 2011, from RM6.59m a year ago. It said  on Friday, July 15, revenue increased by 88% to RM20.28m from  RM10.78m. Earnings per share were 2.53 sen compared with 2.68 sen.  (The Edge)

ACE Market-bound Inari posts net profit RM2.6m in 3Q
ACE Market-bound Inari Bhd posted net profit RM2.6m for the third quarter  ended March 31, 2011 on the back of revenue RM35.8m. For the nine  months ended March 31, the company’s net profit was RM14.7m on the  back of revenue RM77m. (The Edge)

20110718 0902 Global Market Related News.

Stocks, euro fall before Europe bank stress tests
LONDON, July 15 (Reuters) - Banks led losses for European shares and the euro fell on Friday as investors worried financial sector stress tests will throw up some unwanted surprises to add to the region's debt crisis.
"We have still got a cocktail of uncertainties for investors," said Keith Bowman, equity analyst at Hargreaves Lansdown.

POLL-World economy to keep strong but risks abound
LONDON, July 14 (Reuters) - The world economy should expand steadily this year and next thanks mainly to prospering emerging powers, a Reuters poll showed, but fiscal troubles lurking in Europe and potentially the United States risk blowing this view apart.
The quarterly survey of more than 350 economists from all over the world showed a dimmer outlook for most of the rich-world Group of Seven economies since the last survey in April.

Bernanke warns spending cuts could derail recovery
WASHINGTON, July 14 (Reuters) - U.S. Federal Reserve Chairman Ben Bernanke warned on Thursday that overzealous cuts to government spending in the short term could derail a shaky recovery and said a U.S. debt default could wreak financial havoc.
"I only ask ... as Congress looks at the timing and composition of its changes to the budget, that it does take into account that in the very near term the recovery is still rather fragile, and that sharp and excessive cuts in the very short term would be potentially damaging to that recovery," Bernanke told the Senate Banking Committee.

S&P warns of US downgrade if no debt deal reached
SYDNEY, July 15 (Reuters) - Ratings agency Standard & Poor's has warned there is a one-in-two chance it could cut the United States' prized triple-A rating if a deal on raising the government's debt ceiling is not agreed soon.
Putting the U.S. on negative watch, S&P warned that it could cut the rating as soon as this month if talks between the White House and Republicans remain stalemated. Any cut would be by one or more notches, it added.

U.S. Home Sales, Construction Probably Rose (Source: Bloomberg)
Home sales and construction in the U.S. probably rose in June from depressed levels as the industry struggled to gain traction in the face of foreclosures, falling prices and rising unemployment, economists said before reports this week.

Obama Presses Congress for U.S. Debt Deal While Dismissing Republican Plan (Source: Bloomberg)
While President Barack Obama publicly presses congressional leaders for a multitrillion- dollar agreement in deficit-cutting talks he said are “running out of time,” aides privately are negotiating the framework of a possible compromise.

Obama Says Congress Should Be Willing to Raise Revenue to Reduce Deficit (Source: Bloomberg)
President Barack Obama said Republican lawmakers should agree to raising revenue in any deficit-cutting deal, noting he has agreed to consider cuts to entitlement programs such as Medicare. “I’m willing to do what it takes to solve this problem, even if it’s not politically popular,” Obama said in his weekly radio and Internet address. “I expect leaders in Congress to show that same willingness to compromise.”

Income Expectations Point to Slowdown in U.S. Consumer Spending (Source: Bloomberg)
Consumers are turning more pessimistic about their income prospects, an indication that household spending will grow at a slower pace compared with a year earlier. The share of Americans foreseeing a drop in wages over the next six months topped the proportion projecting an increase by 2.6 percentage points in June, data from the Conference Board, a New York research group, showed. That is the lowest reading since October 2010, according to Lynn Franco, director of the group’s consumer research center.

U.S. Consumer Prices Excluding Food, Energy Climb as Manufacturing Stalls (Source: Bloomberg)
A measure of consumer prices climbed more than forecast in June and manufacturing stalled, highlighting the dilemma faced by Federal Reserve policy makers as they seek to boost growth without stoking inflation. Consumer prices excluding food and energy climbed 0.3 percent for a second month, the biggest back-to-back gain in three years, the Labor Department said today in Washington. Factory production was unchanged last month, data from the Fed showed.

U.S. Consumer Confidence Unexpectedly Declines to 63.8 From 71.5 in Index (Source: Bloomberg)
Confidence among U.S. consumers unexpectedly fell in July to the lowest level in more than two years, adding to concern that weak employment gains and falling home prices may keep households from spending. The Thomson Reuters/University of Michigan preliminary index of consumer sentiment decreased to 63.8, the weakest reading since March 2009, from 71.5 the prior month. The gauge was projected to rise to 72.2, according to the median forecast of 62 economists surveyed by Bloomberg News.

Japanese Equities Beating World as Industrial Output Rebounds With Toyota (Source: Bloomberg)
Equities in Japan are rising more than any other developed country on speculation earnings will improve as the country recovers from its strongest earthquake. The Nikkei 225 (NKY) Stock Average climbed 2.9 percent since the start of June, posting the biggest increase among 24 developed countries in the MSCI World Index, according to data compiled by Bloomberg. Toyota Motor Corp. climbed 4.9 percent since June 17 after saying production is rebounding faster than expected. A measure of transport-equipment makers in the broader Topix index rose 3.6 percent as the government said June 29 that May industrial production expanded the most in 50 years.

U.K. Economy to Grow Less Than Previously Forecast on Consumer, Greek Risk (Source: Bloomberg)
Ernst & Young LLP’s Item Club will cut its U.K. economic growth forecasts for the second time this year as weak consumer spending and Europe’s sovereign-debt crisis cloud the outlook for the recovery. Gross domestic product will increase 1.4 percent in 2011, compared with an April projection of 1.8 percent, the London- based Item Club, which uses the same forecasting model as the U.K. Treasury, will say in a report to be published in London tomorrow. It will rise 2.2 percent in 2012, instead of 2.3 percent. The Item Club also reduced its forecasts in April.

Trichet Says Europe Can Surmount Debt Crisis (Source: Bloomberg)
European Central Bank President Jean-Claude Trichet said Europe can surmount its sovereign debt crisis by showing the will and determination to do so. “Naturally the Europeans can manage the issue,” Trichet said in an interview with the Financial Times Deutschland, according to a transcript released yesterday by the Frankfurt- based ECB. “It is not a question of technique. It is a question of will and determination.” Trichet said the euro is not in danger and remains “a highly credible currency.” He reiterated that the ECB will not accept as collateral bonds from a nation that defaults.

Europe's banks brace for some health test failures
LONDON, July 15 (Reuters) - A health check of European banks is expected to show that as many as 15 lenders need more capital to withstand a prolonged recession, with criticism growing that the tests do not encompass the impact of a Greek default.
Europe's bank "stress test", to be published at 1600 GMT, will make 90 lenders reveal for the first time their profit forecasts, a breakdown of their sovereign bond holdings and funding costs, and will force the weakest to recapitalise.

Euro Falls Before Summit as Debt Concern Mounts (Source: Bloomberg)
The euro fell against most of its major counterparts on speculation European leaders will fail to come up with sufficient measures to contain the region’s debt crisis at a summit this week.

FOREX-Euro in range vs dollar before EU bank stress tests
LONDON, July 15 (Reuters) - The euro steadied against the dollar on Friday, as fears the results of European bank stress tests due later in the day could further sour sentiment towards the currency were tempered by concerns about U.S. debt after a rating agency warning.
With worries about the euro zone and the United States roughly offsetting each other, the euro  was left stuck in a range above a four-month low of $1.3838 hit earlier this week and below Thursday's high of around $1.4282.

20110718 0901 Global Commodities Related News.

Commodity outflows slow in June-BlackRock
LONDON, July 15 (Reuters) - Outflows from commodity exchange traded products (ETPs) slowed in June to $238 million, after haemorrhaging over $2.6 billion in May, but only agriculture and precious metals recorded net inflows, according to data from BlackRock and ETF Securities.
Instead equities were in favour, with over $8.98 billion of net inflows globally according to BlackRock, with high dividend paying sectors such as healthcare and real estate in favour.

Corn (Source: CME)
US corn futures end mostly higher on next week's heat wave, and concerns it will continue through the end of the month. Hot weather next week comes at a bad time, with some of the crop in pollination. Question is how long it will last. Prices pulled back from early highs after updated weather forecasts. "There was a little hint today that maybe temps aren't going to be as extreme," says Western Milling analyst Joel Karlin. Direction of Sunday evening's trade will likely be decided by weather forecasts. CBOT September corn up 10 1/2c (1.5%) to $7.01 1/4; Dec corn up 6 1/2c to $6.85.

Wheat (Source: CME)
US wheat futures end lower, backpedaling from early gains on concerns about US exports. News that Egypt passed on US supplies in favor of buying Russian wheat weighed on prices. Results of Egypt's latest tender Friday reminded traders of just how competitive the wheat market is and how US prices are overvalued in world export markets. The market was concerned that Russian prices were $30 a ton cheaper than French wheat and $30 to $50 a ton cheaper than US offers, said Rich Nelson, director of research at Allendale Inc. CBOT Sept wheat end down 1.7% at $6.94 3/4, KCBT September wheat dropped 0.1% to $7.64 1/4 and MGEX September wheat end down 0.6% to $8.23 3/4.

Rice (Source: CME)
CBOT rice futures finish little changed as the market took a pause from recent sharp gains. The market is up 8.7% since Monday's close, but some traders say gains are not supported by cash prices, which have lagged. Worries about a scorched US crop, reduced acreage and strong world prices have supported the market's rally. CBOT September rice ends down 1/2c at $16.99 1/2 per hundredweight while other contracts finished slightly higher.

Wheat Slides for a Second Day as Importers May Favor Russia Over U.S., EU (Source: Bloomberg)
Wheat fell for a second day in Chicago on speculation buyers of the grain will turn to Russian supplies and shun the U.S. and the European Union. Rice slid. Russia’s overall grain harvest may total 90 million metric tons in 2011 and exporters will ship 1.5 million tons in July, First Deputy Prime Minister Viktor Zubkov said yesterday. That’s up from the 85 million tons forecast by Prime Minister Vladimir Putin last month. Egypt, the world’s biggest wheat importer, said this week it may add Romania and Ukraine as suppliers.

Soybeans Cap Longest Rally Since 2007 on U.S. Weather Woes; Corn Climbs (Source: Bloomberg)
Soybeans rose, capping the longest rally since 2007, and corn climbed to a one-month high on speculation that hot, dry weather will reduce crop yields in the U.S., the world’s leading exporter. High temperatures will rise to as much as 12 degrees Fahrenheit above normal for seven days starting tomorrow in the Midwest, Mike Tannura, the president of T-storm Weather LLC, said in a telephone interview. As much as 46 percent of the corn crop and 44 percent of soybeans have drier-than-normal topsoil, and the adverse conditions may extend into August, he said.

Wheat up, on track for biggest weekly rise since May
SINGAPORE, July 15 (Reuters) - Chicago wheat rose 0.4 percent on Friday, lifted by short-covering and speculative buying which has put the commodity on track for its biggest weekly gain since late May.
"The price action in wheat has been certainly of investment flows coming back to the market," said Paul Deane, agricultural commodity strategist at ANZ.

Russian grain yields higher depsite rain-hit harvest
MOSCOW, July 15 (Reuters) - Russia has so far reaped less grain than a year ago, as the harvesting was delayed by rains in the south, while higher yields could help the country to achieve a large crop, Agriculture Ministry data showed on Friday.    
Farmers harvested 6.5 million tonnes of grain by bunker weight by July 13, down from 10.3 million a year ago, when the country had to accelerate the harvesting campaign due to a severe drought, the data showed.  

India's monsoon 19 pct below normal, concerns over rice
NEW DELHI, July 14 (Reuters) - India's crucial monsoon rains were 19 percent below normal in the week to July 13, a slight pick up from a quarter below average in the previous week, but the fall off in rains is raising concerns particularly over rice production.
The rains had been expected to slow in the first two weeks of July, the key month for planting, and are still forecast to be only slightly below normal for the entire June to September season with a pick-up seen in most areas next week.

Hot weather to stress US corn night and day
CHICAGO, July 14 (Reuters) - A heatwave forecast to hit the U.S. Midwest next week is expected to stress developing corn throughout the day and night, providing no relief for a crop that needs a break when the sun sets to realize its full potential.
After hot nights, corn leaves are often curled up, much like they typically are in the middle of the day, evidence that the plant was working throughout the night and burning through its much needed sugar reserves and using up water in the soil.

Dryness hastens Argentina wheat planting-exchange
BUENOS AIRES, July 7 (Reuters) - Dry weather hastened 2011/12 wheat planting last week in Argentina, where 4.7 million hectares are expected to be seeded with the grain this season, the Buenos Aires Grains Exchange said on Thursday. Argentina is a leading wheat exporter and sends most of its output to neighboring Brazil.
"The lack of rains during the last seven days helped with the planting process in central and western portions of Buenos Aires (province)," which produces about half of the country's wheat, the Buenos Aires exchange said in its weekly crop progress report.

Dire drought worsens in US Plains, creeps into Kansas
CHICAGO, July 14 (Reuters) - The worst drought in decades tightened its grip on the southern U.S. Plains in the past week as triple-digit temperatures and a lack of rain scorched cattle grazing pastures and parched crops, according to a report issued by U.S. climatologists on Thursday.
Exceptional drought, the most severe category measured by climatologists, now encompassed more than 70 percent of Texas and more than 40 percent of Oklahoma.

Most Saskatchewan spring crops in good/fair shape
WINNIPEG, Manitoba, July 14 (Reuters) - Most Saskatchewan spring-seeded crops are in good or fair condition, although a little more than half of them are developing more slowly than normal, the provincial government said on Thursday in a weekly report. 81 percent of spring wheat and lentils are in good to fair condition, along with 80 percent of durum and 74 percent of canola. 82 percent of winter wheat and 79 percent of peas are in good to excellent condition.

Russian 2011 grain crop seen 90 mln T - deputy PM
MOSCOW, July 14 (Reuters) - Russia on Thursday increased its forecast for this year's grain crop and confirmed it sees no need to restrict exports, which are picking up following the lifting of an export ban at the start of this month.    
Russia's grain crop may reach 90 million tonnes this year, up from an official estimate of 85 million tonnes and from last year's 61 million tonnes, First Deputy Prime Minister Viktor Zubkov told a cabinet meeting.  

Indonesia's Bulog may import rice from six countries
JAKARTA, July 14 (Reuters) - Indonesia's state procurement agency Bulog could import rice from six countries which have a surplus of the staple, CEO Sutarto Alimoeso said on Thursday.
"We are exploring all possibilities that include importing rice from India, Pakistan, Thailand, Vietnam, Cambodia and Myanmar. We are hoping to import from those countries through a government-to-government scheme," Alimoeso told reporters at parliament.

Farmers Seek More Operating Loans As Fuel, Fertilizer Costs Climb -KC Fed (Source: CME)
U.S. agricultural lenders issued more operating loans in the second quarter versus a year ago as farmers grappled with rising fertilizer, fuel and feed costs, the Federal Reserve Bank of Kansas City said. Non-real-estate farm loan volumes jumped 14% in the second quarter from a year ago, the bank said. The average size of short-term operating loans jumped 36%, driven by the rising input costs. Meanwhile, capital spending in the farm sector cooled, the bank said, leading to a drop in loan volumes for farm machinery and equipment. The volume of such loans "plunged from a first quarter spike" and were down 36% from a year ago, the bank said. The bank's quarterly report is a compilation of national and regional agricultural finance data. The report noted that agricultural bank profits were strong in the first quarter, but said a rise in delinquency rates could "hinder future profits."
Real estate farm loan delinquency rates, after dipping at the end of 2010, climbed to almost 3% during the first quarter. The bank also noted that the share of real estate loans 30 to 89 days past due also climbed, "setting the stage for rising delinquency rates in the coming months." Farmers have enjoyed a surge in crop prices this year that has boosted profits and also sent farmland values soaring, with first quarter land prices jumping at least 20% in Iowa, Minnesota, Nebraska, Kansas and North Dakota.  However, the crop prices mean higher feed costs for livestock producers, and prices for crop inputs including fertilizer and seeds are climbing as companies seek to take advantage of farmers' higher profits. The Kansas City Fed has warned that a sharp drop in crop prices or tightening of the Federal Reserve's monetary policy could lead to a significant drop in farmland values, although many analysts say there is no farmland bubble and that loan-to-asset ratios have remained low.

Brazilian Exports To Arab Nations Leap 33% On Year, Food Leads (Source: CME)
Brazilian exports to Arab nations leapt by 33% on the year in the first half of 2011, led by growth of sales of food commodities and iron ore, the Brazil-Arab News Agency said, citing data compiled by the Arab Brazilian Chamber of Commerce. The value of Brazilian exports to Arab nations over the period were $6.41 billion, the agency said. The growth in Brazilian exports to Arab nations was seen mainly in meats, sugar, grains, vegetable oil, seeds, oleaginous grains and iron ore. The agency said the rise reflected efforts in Arab nations to establish healthy stocks due to their own inability to produce enough food commodities and iron ore. The approaching Muslim fasting month of Ramadan was also a contributing factor bumping up Arab imports of Brazilian food commodities over the period, the statement said. Arab nations stockpile sugar and grains in advance of Ramadan to adhere to customs of donating large quantities of food to charity.
Brazilian wheat exports to Arab nations this year "attracted the most attention," even though the country isn't a traditional exporter of the commodity. "The wheat produced in the last crop is not the most appropriate for the bread industry in Brazil," the statement said. "There was, therefore, a surplus that could be exported." However, Brazil's wheat however is suitable to be used to make bread that doesn't need to rise, such as pita bread, consumed heavily in the typical Arab diet. Demand from Arab nations for Brazilian iron ore was "heated," the statement said, adding that Arab nations, in particular Egypt, traditionally sourced iron ore from India but have been looking for alternative sources after the Indian government's decision to limit exports.

China 2011 Grain Output May Grow Slower Than Last Year (Source: CME)
China's agriculture ministry is forecasting steady grain output this year, while also seeking to assure consumers that a ready supply of pork will be hitting markets in coming months. "We think it's very difficult to achieve an increase this year in output of autumn grain," the ministry's chief economist and spokesman, Chen Mengshan, according to a transcript on the ministry's website. At the same time, Chen said, "We expect pig production to rise gradually in the second half, and supply is secure." The comments come on the same day that the Ministry of Commerce announced it will release pork reserves to help contain sharply rising pork prices, which have been cited as being major contributors to China's 6.4% inflation rate in June. Chen's forecast of a stable autumn grain harvest suggest that China's grain output this year will grow slower than last year, as autumn output of grains--including corn, rice and soybeans--accounts for about 75% of the nation's total grain production.
In 2010, total output increased 2.9% from a year earlier to 546.41 million metric tons. China's meteorological officials expect a drought between July and November in major corn-producing areas of northeastern China as well as in the main rice area south of the Yangtze River, he said, adding that crops may be damaged by insects. Autumn grain acreage will likely rise 0.6% from a year earlier to 77.1 million hectares, with corn and rice areas increasing "considerably," Chen said. Corn acreage totalled nearly 33.3 million hectares, an increase of 2% from a year earlier, while mid-season rice area reached 18 million hectares, an increase of 3.1%, the National Development and Reform Commission said in a separate report. NDRC said soybean area this year will likely fall 11% from last year to 7.6 million hectares. Harvest of autumn grain is expected to be "good" if there is no major natural disasters, the NDRC said in a statement.
China's 2011 summer grain output, most of which is wheat, reached 126.27 million tons, up 3.12 million tons, or 2.5%, from 2010, the National Bureau of Statistics said Monday. Hog production has shown signs of recovering, with pig inventories rising for a fourth consecutive month in June, Chen said. The Ministry of Commerce's plan to release pork reserves may not have much of an impact on prices or availability, as stocks total around 200,000 tons, equivalent to merely 1.5 times the nation's daily pork consumption of around 140,000 tons, underscoring the difficulties the government faces in using such stockpiles to manage demand. Wholesale pork reached a record price of CNY26.09 a kilogram as of July 8, an increase of 71% from a year earlier, the ministry's data showed.

China Grain Officials Visit US; Signals Easing DDG Tensions (Source: CME)
A Chinese business mission including senior industry officials visited the U.S. to tour of its dried distillers grain industry recently, the U.S. Grains Council said in a report, signaling a further easing of trade tensions between the two countries. Tensions were ramped up late last year, when the U.S Trade Representative complained about Chinese wind-power subsidies, apparently sparking a Chinese antidumping probe into DDG--corn-based animal feed--in December. Late last month, the China National Grain and Oils Information Center said preliminary government findings in the probe were likely to favor "lower-than-expected" antidumping duties. The high-level delegation included the deputy director-general of China's National Animal Husbandry Service and the division chief of the China Feed Industry Association. Senior representatives from some of China's largest livestock and feed companies, including Guangdong Haid Group Co. and Shandong Liuhe Group, were also part of the mission, the USGC said.
The council, which didn't specify when the mission was held, said it briefed the Chinese team on U.S. DDG and ethanol production, regulation and shipping methods.

Investors Boost Bullish Commodity Bets as Gold Demand Jumped on Debt Woes (Source: Bloomberg)
Funds boosted bets on rising commodity prices by the most in almost a year as traders snapped up gold amid escalating debt woes in the U.S. and Europe. Speculators raised their net-long positions in 18 commodities by 15 percent to 1.09 million futures and options contracts in the week ended July 12, government data compiled by Bloomberg show. That’s the biggest gain since early August. Gold holdings surged the most since September 2009 as prices climbed to a record last week. A measure of bullish agriculture bets climbed the most in 11 months.

India's June natural rubber imports jump 60 pct
MUMBAI, July 15 (Reuters) - India's natural rubber imports in June jumped 60 percent on year to 19,118 tonnes as tyre makers raised overseas purchases to cash in on lower prices in other Asian countries, and the trend is likely to continue in coming months also as rubber is still expensive in the country.
Rubber production in June rose 4.1 percent on year to 59,200 tonnes, while consumption of rubber in the month rose to 80,500 tonnes, from 74,450 tonnes in the year earlier period, the state-run Rubber Board said on Friday.

Ghana cocoa farmers receive industry info by mobile
Dakar, July 14 (Reuters) - Ghanaian cocoa farmers have begun receiving vital industry information through short messages to their mobile phones, the Ghana Cocoa Board (Cocobod) said on Thursday, in the latest innovation aimed at boosting output.
Cocobod said the programme known as 'CocoaLink' has been tested since March, with 1,500 farmers currently hooked up. It is due to cover some 100,000 farmers over the next three years.

Colombia coffee production falls for third month
BOGOTA, July 14 (Reuters) - Colombia's coffee output fell for the third straight month in June, declining 40 percent to 471,000 60-kg bags as heavy rains affected flowering, the country's coffee growers federation said on Thursday.
Colombia, the world's top producer of high-quality arabica, was hit by bad weather and fungus in the previous two years, cutting output by about a third of its norm. The country's coffee is among the world's most prized and has a big impact on global markets.

Brazil Govt Still Studying A Lower Ethanol Blend In Gasoline (Source: CME)
Brazil's government continues to study a possible reduction in the percentage of anhydrous ethanol that is mixed into the gasoline blend at fueling stations, the Ministry of Mines and Energy said. "There's no decision yet on that issue. It could happen or it couldn't," an official at the ministry said, confirming an earlier report in local news media citing Mines and Energy Minister Edison Lobao. Lobao told Brazil's Agencia Estado news agency that the change could be made as early as September. Gasoline sold at Brazilian fuel pumps contains 25% anhydrous ethanol, a level that regulators can reduce to as low as 18%, although such a move would mean importing more gasoline. Also sold across Brazil is pure, hydrous ethanol, an alternative available to the country's growing fleet of flex-fuel vehicles. Brazilian sugar-cane producers in the main center-south growing region have harvested about a third of this year's crop, and the result so far has been an 18% drop in output.
Mills process their cane into either sugar or ethanol fuel. The government, struggling to rein in high inflation, is wary of any ensuing rise in fuel prices, with ethanol production in the center-south now expected by sugar-cane association Unica to fall 11% from the previous crop to 22.55 billion liters.  Steadily expanding fuel demand and dwindling ethanol inventories caused a sharp increase in prices at the pump during March and April, before the sugar-cane harvest picked up. To avoid a repeat scenario in the next interharvest period, authorities are hammering out possible measures to regulate ethanol production more, such as requiring that producers hold minimum ethanol stocks. In the event of a serious ethanol shortage, President Dilma Rousseff remains open to the idea of taxing sugar exports, a position opposed by other parts of her government, Sao Paulo's Valor Economico newspaper noted in a report.
Brazil is the world's top producer and exporter of sugar and is the leading producer of sugar cane-based ethanol.

S.Korea's June coal imports fall 2 pct yr/yr
SEOUL, July 15 (Reuters) - South Korea's June coal imports declined 2 percent to 8.50 million tonnes from 8.69 million tonnes a year earlier, data from Korea Customs Service showed on Friday.
Customs data also showed earlier that the country's imports of liquefied natural gas (LNG) rose by 5 percent to 2.12 million tonnes in June from a year earlier.

Euro Coal-Prices stable, Aug S.African trades at $114.75
LONDON, July 14 (Reuters) - Prompt physical coal prices were stable on Thursday but few trades were reported.
Oil moved slightly higher by around 40 cents after opening weaker but coal currently lacks clear direction, utilities and traders said.

Asia Coal-Australia thermal coal prices dip in week
PERTH, July 14 (Reuters) - Australian thermal coal prices slipped about $2 in the week ended on Wednesday as summer buying in Asia, especially from China, slowed to a halt and Japanese demand remained weak.
Thermal coal on the globalCOAL Newcastle index for the week settled at $120.71 per tonne on Wednesday, down from $122.63 a week earlier and down from $122.45 on Friday.

Crude Oil Futures Advance for a Second Day in New York, Climbing 0.2% (Source: Bloomberg)
Oil rose for a second day in New York as investors bet that fuel demand may increase on signs of an improving U.S. economy and after the European Central Bank said Europe can overcome its debt crisis.

China's latest rare earth move disappoints EU, US
BEIJING/SHANGHAI, July 14 (Reuters) - China eased export curbs for rare earth elements on Thursday, restoring them to near-2010 levels in a bid to appease trading partners, but the European Union said the move did not ensure stable supplies and the United States said the Chinese were heading the wrong way.
China accounts for around 97 percent of the world's output of the 17 rare earth metals, which are crucial for global electronics production and the defense and renewable-energy industries. They are are used in a wide range of consumer products, from iPhones to electric car motors.

China's imported iron ore stocks hit record in week ending July 15
SHANGHAI, July 15 (Reuters) - Imported iron ore inventories at major Chinese ports hit a record 94.04 mln tonnes in the week ending July 15, data from industry consultancy Mysteel said on Friday.
Stocks rose 0.4 percent from 93.65 million tonnes last Friday.

Iron Ore-Spot extends gains on firm Chinese steel demand
SHANGHAI/SINGAPORE, July 15 (Reuters) - Spot iron ore prices extended gains on Friday, driving a key global index to near two-month peaks, as steel mills in top producer China continued to restock the raw material in anticipation of strong steel output and demand.
Spot offers for Indian 63.5/63-grade ore rose for a third day, by another dollar to $182-$184 a tonne, including freight, said Chinese consultancy Umetal.

China's imported iron ore stocks hit record in week ending July 15
SHANGHAI, July 15 (Reuters) - Imported iron ore inventories at major Chinese ports hit a record 94.04 mln tonnes in the week ending July 15, data from industry consultancy Mysteel said on Friday.
Stocks rose 0.4 percent from 93.65 million tonnes last Friday.

NICKEL-Major market developments in June
LONDON, July 14 (Reuters) - Nickel prices rebounded from a sharp fall in June, but slow demand and concerns about an impending sharp rise in output will exert downward presure, or at least limit upside prospects in the next month or two.
"We've got a situation of rising production and slowing stainless demand growth," said independent consultant Angus MacMillan.

SAfrica steel firms, striking union reach deal
JOHANNESBURG, July 15 (Reuters) - South African steel and engineering firms reached a wage deal with the National Union of Metalworkers of South Africa (NUMSA) to end a two-week long strike, a union official said on Friday, while a fuel sector strike showed no signs of ending.
Tens of thousands of steel workers downed tools nearly two weeks ago demanding a 13 percent wage rise -- almost three times the inflation rate and nearly double the employers' offer of 7 percent.

Freeport Indonesia production, shipments resume-workers
JAKARTA, July 15 (Reuters) - Production at Freeport McMoRan Copper & Gold's  giant Indonesia mine gradually resumed on Thursday, as workers returned following a strike, and two cargoes carrying 65,000 tonnes of concentrate were ready for shipping on Friday, workers said.
The union representing around 8,000 workers at the Grasberg mine said on Tuesday they had struck a deal to end a strike that began on July 4, though further talks and safety checks at the mine effectively meant work began on Thursday, the union said.
Shanghai warehouse copper stocks up 22 pct
SHANGHAI, July 15 (Reuters) - Copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 22.3 percent from last Friday, the exchange said on Friday.
"Today is the last trading day for the prompt month July contract, so many sellers may be putting stocks so that they can deliver sold cargoes to buyers over the next few days. If the increase is mainly due to this, the data may be slightly misleading," said Jinrui Futures analyst Zhao Kai.

US building slump squeezes scrap copper market
NEW YORK, July 14 (Reuters) - Supplies in the U.S. copper scrap market remained tight at the start of the third quarter, as a lingering slump in industrial demolition rates made material, especially higher-grade material, harder to come by.
The prolonged downturn in the housing sector has squeezed supplies, along with a general reluctance from producers and owners to release more metal into the marketplace as smaller quantities of the secondary scrap metal have limited their ability to quickly fill shipment containers.

METALS-Copper steady, eyes on China consumption
July 15 (Reuters) -     Copper traded steady on Friday, paring earlier gains, as markets awaited the results of European bank stress tests later in the day and investors also eyed trends in top consumer China.
Three-month copper on the London Metal Exchange  was untraded in official rings but bid at $9,626 a tonne from $9,630 a tonne at the close on Thursday.

PRECIOUS-Gold undermined by Bernanke, firm dollar
LONDON, July 15 (Reuters) - Gold slipped on Friday undermined by growing perceptions further stimulus measures from the United States were unlikely and by a higher dollar against the euro, which was under pressure from concern about the results of European bank stress tests.
Spot gold  was bid at $1,581.10 a troy ounce at 1126  GMT from $1,586.75 an ounce late in New York on Thursday when the precious metal hit a record high of $1,594.16.

Gold Advances, Extending Gains to Record for Immediate Delivery, Futures (Source: Bloomberg)
Gold futures gained as much as 0.5 percent to a record $1,597.90 an ounce in New York. The metal traded at $1,596.80 at 8:11 a.m. in Melbourne. Gold for immediate delivery rose as much as 0.3 percent to a record $1,597.73 an ounce.

Baltic index drops 16 points on weak demand
LONDON, July 14 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, fell 16 points to 1367 points on Thursday due to continued weak freight demand.    
The index -- which gauges the cost of shipping commodities including iron ore, cement, grain, coal and fertiliser -- the index has been erratic this year, trading between 1,300-1,500 points as ship oversupply out paces demand to ship commodities.

Asia Dry Bulk-Rates under pressure from weak N.Pacific demand
SINGAPORE, July 14 (Reuters) - Rates for panamax dry bulk carriers on key Asian freight routes are expected to remain under pressure over the next week due to weak demand in the North Pacific and ample vessel availability.
In the capesize market, rates are seen lower as freight activity slows on the key benchmark Australia to China iron ore route, shipbrokers said on Thursday.

20110718 0858 Soy Oil & Palm Oil Related News.

Soybeans (Source: CME)
US soybean futures ended higher, supported but the ongoing threat of extreme heat negatively impacting soybean yields in the Midwest. The soybeans crop is still a few weeks away from its critical yield development stage in August, but the longer heat lingers in the region, the higher the risk threat to soy crops, analysts say. The market continued to factor in risk premium, unwilling to abandon higher price levels with 100 degree temperatures baring down on Midwest crops for the next week, analyst add. CBOT Nov soy end up 3c at $13.87/bushel.

Soybean Meal/Oil (Source: CME)
Soy product finish up with soybeans, as threats to the soybean crop provided support to underpin prices. Soymeal climbed on fears of fewer soybeans for crushing, while soyoil drew further support from strong gains in crude oil futures, analysts say. CBOT Dec soymeal rose 0.9% to $365.90/short ton, and Dec soyoil ended up 0.03% at 58.26 cents/pound.

Indonesia sees 6 pct growth in annual soybean demand
JAKARTA, July 14 (Reuters) - Indonesia's annual soybean consumption will grow by up to 6 percent because of an increase in population, but Southeast Asia's largest economy is unlikely to reach self-sufficiency in 2014, chairman of the National Soybean Board said on Thursday.
Indonesia is struggling to increase soybean production to stop its reliance on imported grains and aims to scrap imports by 2014, but domestic output has not increased significantly because of land constraints and low productivity.

Palm retreats on supply build up, economy concerns
KUALA LUMPUR, July 15 (Reuters) - Malaysian palm oil futures retreated on Friday from a three week high hit the previous day as traders booked positions on expectations on higher supply and uncertain global economic outlook.
"Talks of slower demand (in the future) and higher production have triggered profit-taking," said a trader in Kuala Lumpur. "The increase in exports would not have caused havoc to the palm oil market since we could have high stocks level end this month," he added.