Thursday, December 6, 2012

20121206 1001 Soy Oil & Palm Oil Related News.

Soybean Complex Market Recap (CME)
January Soybeans finished up 23 3/4 at 1479 1/4, 1/2 off the high and 25 3/4 up from the low. March Soybeans closed up 23 1/2 at 1473 3/4. This was 25 1/2 up from the low and 1/4 off the high.
January Soymeal closed up 6 at 446.3. This was 6.5 up from the low and 0.6 off the high.
January Soybean Oil finished up 0.94 at 51, 0.04 off the high and 1.04 up from the low.
January soybean saw double digit gains on the day due to strong Chinese demand and a positive technical setup. Thoughts that the Chinese economy has turned the corner and inflation fears may be subsiding added to the bullish tilt. Chinese crush margins have improved in the last couple of weeks and basis in the PNW has firmed this week. Rumors that the US may have sold up to 6 cargos to China fueled the rally throughout the day. The South American weather outlook is mostly favorable with Brazil seeing timely rainfall in the north and better precipitation is expected in the southern region. Argentina is trending too wet at the moment which has delayed corn sowings. Some analysts expect soybean acreage to increase due to these delays. Strong calendar spread buying and firm basis at US export ports helped to support the positive tone to the marketplace.

EDIBLE OIL: Malaysian palm oil futures slipped 0.3 percent as expectations of record stocks in November weighed on sentiment, although traders are looking at higher exports and slowing output this month. (Reuters)

Palm Oil Stockpiles in Malaysia Seen Holding Near Highest Ever (Bloomberg)
Palm oil stockpiles in Malaysia, the world’s biggest producer after Indonesia, probably held near a record last month as production exceeded exports, according to a Bloomberg survey.
Inventories were 2.5 million metric tons compared to 2.51 million tons in October, according to the median of estimates from four analysts and two plantation companies. Output probably fell 5.7 percent to 1.83 million tons, while exports gained 1.7 percent to 1.79 million tons, the survey showed. The Malaysian Palm Oil Board is scheduled to release official data on Dec. 10.
Futures of the oil used in food and biofuels are headed for the worst annual slump since the financial crisis in 2008 on lower demand and the biggest ever reserves. That decline may pare profits and revenues at producers including Sime Darby Bhd. (SIME) and Golden Agri-Resources Ltd. (GGR) For 2013, Rabobank International has picked palm oil as likely to be the best-performing agricultural commodity as the stockpiles drop and sales revive.
“It’s still a buyers’ market because they know there’s a lot of stock and they don’t need to hurry,” said Ivy Ng, an analyst at CIMB Group Holdings Bhd. (CIMB) in Kuala Lumpur. Prices are “unlikely to rebound significantly,” she said.
Palm oil for February delivery ended at 2,284 ringgit ($751) a ton on the Malaysia Derivatives Exchange in Kuala Lumpur yesterday, down 28 percent this year. Most-active prices touched a three-year low of 2,220 ringgit on Nov. 12.

‘Cool Down’
“People were expecting that perhaps stocks could cool down a bit in the month of November,” said Ng. “It doesn’t seem like that is going to be the case because the production didn’t drop as much,” with strong output seen in Sabah, she said.
Sabah, on Borneo Island, is Malaysia’s top producing state, accounting for about 29 percent of total output in the first 10 months of 2012, according to palm oil board data. Production usually peaks from July to October, then tapers off in November.
Dorab Mistry, director at Godrej International Ltd., revised his forecast for Malaysian stockpiles on Jan. 1 to 2.7 million to 2.8 million tons from a previous call of 3 million tons. Prices will trade between 2,300 ringgit and 2,600 ringgit a ton between now and February, he told a conference Nov. 30.
Prices may have bottomed as stockpiles are set to drop amid a pick-up in demand from buyers including India, Thomas Mielke, executive director of Oil World, said Nov. 30. Futures may gain to 3,100 ringgit to 3,200 ringgit between March and May, he said.
Palm oil may be the best performer next year, trading at 2,700 ringgit a ton by the fourth quarter, Rabobank analysts led by Luke Chandler said in a Nov. 28 report. Demand may climb from importers including India, Rabobank said.

China Rules
Inventories may take longer to deplete in the New Year as China, the biggest cooking oil user, may import less once new food-safety rules come into effect Jan. 1, said CIMB’s Ng. “The concern post-December is how the demand will move,” she said.
China’s palm oil inventories at major ports may exceed 1 million tons by the year-end as an estimated 700,000 tons will arrive in China in each of the final two months of the year, the China National Grain & Oils Information Center said on Dec. 3.
Exports from Malaysia rose 3.9 percent to 1.66 million tons in November from a month earlier, surveyor Intertek estimated on Nov. 30. Shipments gained 5.2 percent to 1.65 million tons in the same period, according to Societe Generale de Surveillance.

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