Palm-Oil Stockpiles in Malaysia Set to Reach Seven-Month Low (Bloomberg)
2012-04-05 02:49:02.604 GMT
By Ranjeetha Pakiam
April 5 (Bloomberg) -- Palm-oil reserves in Malaysia, the second-biggest supplier after Indonesia, probably declined to the lowest level in seven months in March as exports outpaced growth in production, according to a Bloomberg survey.
Stockpiles fell 2.4 percent to 2.01 million metric tons, from 2.06 million tons in February, according to the median of estimates in the survey of four analysts and two plantation companies. Inventories are expected to be 25 percent higher than a year earlier, the survey showed. Official estimates from the Malaysian Palm Oil Board are scheduled for release on April 10.
Prices gained 12 percent this year on concerns global cooking-oil supplies will drop after drought reduced soybean harvests in Brazil and Argentina and as U.S. farmers plant fewer acres of the oilseed crushed to make soybean oil, a substitute of palm oil in food and fuels. Lower stockpiles may help palm-oil prices rally even higher, potentially raising profits for Malaysian companies including Sime Darby Bhd. and IOI Corp.
“Production is slightly lower than export growth,” Hoe Lee Leng, an analyst at RHB Capital Bhd., said by phone in Kuala Lumpur yesterday. Rising imports from Indonesia were a “skewing factor” in keeping stockpiles in Malaysia above the 2-million ton level, she said.
A cut in export taxes for refined palm oil and olein in Indonesia last year made it cheaper for Malaysian producers of oleochemicals, or specialty fats, to buy from the country, the biggest supplier, said Hoe. Total imports rose to 246,419 tons in February from 209,408 tons in January, board data showed.
Output Climbs
Malaysia’s output advanced 4.2 percent to 1.24 million tons in March, the first gain in five months, from 1.19 million tons in February, according to the survey. Shipments rose 4.8 percent to 1.23 million tons in March after a 10.5 percent drop in February, surveyor Intertek said March 31.
Exports recovered as “soybean supplies look tight, while post-winter demand kicks in,” Ben Santoso, an analyst with DBS Vickers Securities (Singapore) Pte., said in an e-mail.
World output of soybeans may drop to 242.9 million tons in 2012, including a cut of 16 million tons in South American production, Thomas Mielke, executive director of Oil World, said March 26. Palm oil clouds in cooler weather, leading to a seasonal drop in exports during the winter months.
The June-delivery contract declined 0.5 percent to 3,538 ringgit ($1,153) a ton on the Malaysia Derivatives Exchange at 10:44 a.m. in Kuala Lumpur. Futures reached 3,574 ringgit a ton yesterday, the highest price for the most active contract since March 9, 2011.
The price may jump to 4,000 ringgit by the end of June on declining global vegetable-oil stockpiles, Dorab Mistry, director of Godrej International Ltd., said March 27, reiterating an earlier forecast. Global production of palm oil will increase by 2 million tons this marketing year compared with a 5.5-million ton gain in 2010-2011, he said.
Market bulls gave up some control in the soybean market heading into the close, causing futures to soften to a mixed finish. Old-crop futures were around 3 cents firmer while September through March futures were fractionally to 3 1/4 cents lower. Recent choppy price action indicates the soybean market needs fresh demand news to continue its march higher. (Source: CME)
Soybean Complex Market Recap (Source: CME)
Wed 04 Apr 2012 14:21:01 CT
May Soybeans finished up 2 3/4 at 1419 1/2, 10 1/4 off the high and 11 1/4 up from the low. July Soybeans closed up 2 1/2 at 1423 3/4. This was 11 up from the low and 10 off the high. May Soymeal closed up 1.7 at 388.2. This was 2.4 up from the low and 4.5 off the high. May Soybean Oil finished up 0.12 at 56.02, 0.43 off the high and 0.32 up from the low. May soybeans shook off the bearish tilt to outside markets to close slightly higher on the session. More private projections for smaller South America crops and the "need" for soybeans to gain on most other crops in order to secure higher planted area that the March USDA planted acreage intentions has helped to provide underlying support. A bearish tilt to outside markets helped to pressure the market early today with a sharp drop in gold, crude oil and the stock market early plus a strong US dollar helped to spark selling pressures. Continued downgrades of the crops in Brazil and a firm tone to the corn market helped to turn the market higher and futures pushed sharply higher on the day into the mid-session. Taiwan is tendering for 40,000 to 60,000 tonnes of US or Brazil soybeans for May/June shipment.
VEGOILS-Palm rises to 13-month high on demand hopes
SINGAPORE, April 4 (Reuters) - Malaysian palm oil futures climbed to an almost 13-month high as traders continued to bet on a brighter demand outlook for palm oil following expectations of a smaller soybean crop in coming months.
"If you are talking about an extraordinary leap, rather than a minor day-to-day fluctuation, it's more likely credited to the USDA report," said Selena Leong, an analyst at DMG & Partners Research in Singapore.
Brazil soy crop put at 65.2 mln T due drought
SAO PAULO, April 3 (Reuters) - Drought in Brazil shrunk the world's second-largest soybean crop to an estimated 65.2 million tonnes this 2011/12 season, down nearly 2 million tonnes from the March forecast of 67.1 million tonnes, local crop analysts Agroconsult said Tuesday.
That projection was one of the lowest among recent forecasts, and well below Brazil's record soy harvest of 75.3 million tonnes last season. Drought over Brazil, Argentina and Paraguay has supported soy futures prices in Chicago since December.
Taiwan 11/12 soybean imports to fall
April 3 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in Taiwan:
"Taiwan typically ranks among the top five export markets for U.S. soybeans, but marketing year 2011/12 imports are expected to fall to 2.2 million tonnes due to reduced livestock production following outbreaks of avian influenza and foot and mouth disease. Higher oil and protein content is stimulating interest in South American beans. As a result, U.S. market share could also fall in MY2011/12. With an expected recovery in the livestock sector, imports are forecast to improve to 2.4 million tonnes in MY2012/13."
Argentine soy crushing rises 11 pct in February
BUENOS AIRES, April 3 (Reuters) - Argentine soy crushing activity rose 11 percent in February from the same month last year to 2.3 million tonnes, the Agriculture Ministry said in its latest crushing report.
Argentina is the world's top supplier of soyoil and soymeal and crushing activity has increased in recent years due to investment in plants, most of them near the port city of Rosario.
Brazil's soy crop seen at 65.2 mln T - Agroconsult
SAO PAULO, April 3 (Reuters) - Drought over Brazil shrunk the world's second-largest soybean crop to an estimated 65.2 million tonnes this 2011/12 season, down from 67.1 million tonnes forecast in March, local crop analysts Agroconsult said on Tuesday.
Brazil put out a record harvest of 75.3 million tonnes of soybeans last season. Strong exports of the 2010/11 crop late last year will likely allow Brazil to displace the United States as the largest exporter of the world's most important source of protein.
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