Soyoil futures stumbled Thursday, succumbing to speculative selling. The combination of spillover weakness from tumbling crude oil futures, meal/oil spreading and a large build up of supplies overshadowed a supportive sale of U.S. soyoil to China, Prime Ag Consulting analyst Chad Henderson said. Crude oil influences soyoil due to its use in making renewable fuels. December soyoil settled 0.45 cent, or 1.2%, lower at 36.72 cents per pound.(Source: CME)
Malaysia CPO Output Growth To Slow, Miss Target-Minister(Source: CME)
Malaysia's crude palm oil output this year will likely fall below a previous forecast as unusually wet weather caused by the La Nina weather development may damage crops and reduce yields, Plantation and Commodities Minister Bernard Dompok said Thursday.
Dompok told Dow Jones Newswires via email that he is revising his forecast for Malaysian CPO output to 17.8 million metric tons this year from a previous prediction of 18.1 million tons due to concerns over the likelihood of unusually wet weather in the second half of the year. Malaysia produced 17.6 million tons of CPO last year.
Dompok didn't give a prediction for CPO prices but slower production growth in Malaysia, the world's second-biggest palm oil producer, could provide a floor for the market that has seen a 13% fall in prices since the start of the year. CPO futures prices have been pressured by a record soybean crop in South America which narrowed the price gap between the two vegetable oils, making soyoil a cheaper alternative in some cases.
Wet weather may curb output towards the end of this year, Dompok said, even though total planted area has risen by 2.8% to 4.82 million hectors so far and yields rose slightly to 19.26 tons per hector from 19.20 tons in 2009.
The La Nina weather condition, associated with cooler-than-average sea surface temperatures in the Pacific ocean, may affect crop development as it usually results in above-average rainfall in Malaysia and Indonesia.
While oil palm trees thrive in moist conditions, rising soil moisture can reduce yields. Floods and heavy rainfall also slow harvesting and make transportation of fresh fruit bunches and extracted oils more difficult.
Plantation company executives said part of the slowdown in Malaysian production growth has been caused by labor woes. Improved wages in Indonesia are luring back Indonesian plantation workers while Malaysian companies are finding it difficult to bring in new workers because of recently tightened work-permit rules.
But the government's recent decision to review some of the work-permit provisions may help ease the labor shortage and stem a fall in productivity, said Dompok.
Palm oil down, China slowdown worries weigh
KUALA LUMPUR, July 1 (Reuters) - Malaysian crude palm oil futures fell more than 1 percent , tracking volatile crude oil and equity markets, on signs China's economic growth was slowing.
"The market is still very weak and prices are temporarily moving sideways to downward," said a trader with Kuala Lumpur based-foreign brokerage.
Monsoon soaks India soybean area after June lag
NEW DELHI, July 1 (Reuters) - India's vital monsoon rains revived in the soybean-growing central region on Thursday, after a two-week lag that reduced June rainfall to 16 percent below normal, the second lowest in 15 years.
Heavy showers in the central Madhya Pradesh state would accelerate soybean planting in the world's top importer of edible oils and ease growing nervousness about monsoon rains.
USDA corn data a reality check for soy/corn spread
CHICAGO, June 30 (Reuters) - A shocking drop in U.S. corn stockpiles and smaller-than-expected 2010 corn plantings data on Wednesday jolted Chicago Board of Trade grain traders and immediately shrank a popular, benchmark "spread" trade.
The price ratio between CBOT new-crop November soybeans and new-crop December corn is a traditional key for futures traders, farmers and grain users to watch.
No comments:
Post a Comment