Wednesday, January 16, 2013

20130116 1437 Palm Oil Related News.

VEGOILS-Malaysia's zero export-tax move lifts palm to more than 1-week high BOZ2 DBYF3 FCPOc3 - RTRS
16-Jan-2013 14:29
Zero pct CPO tax in Feb to boost exports -trader Investors see stockpiles coming off in February from record high Palm oil may test resistance at 2,449 ringgit -technicals

(Updates prices, adds detail)
By Anuradha Raghu
KUALA LUMPUR, Jan 16 (Reuters) - Malaysian palm oil futures rose to a more than one-week high on Wednesday on investor optimism a zero-duty tax structure will spur exports from the world's No.2 producer and help boost global demand for the tropical oil.
The positive sentiment was also buoyed by seasonally slowing production which could help curb stockpiles that hit a new record of 2.63 million tonnes in December.
The Malaysian government announced on Tuesday that it will retain its crude palm oil export tax at zero percent for February, in an effort to give a competitive edge over top producer and biggest rival Indonesia. (Full Story)
"Indonesia's crude palm oil is now pricier than Malaysian crude palm oil. So Malaysian exports will definitely pick up," said a trader with a foreign commodities brokerage.
"Most traders are trading on the forward view. Even though exports are not looking so good now, but with the overall drop in production, we are expecting stocks to be lower in February or March," the trader added.
By the midday break, the benchmark April contract FCPOc3 on the Bursa Malaysia Derivatives Exchange had climbed 0.8 percent to 2,433 ringgit ($806) per tonne. Prices earlier touched 2,441 ringgit, the highest level seen since Jan. 7.
Total traded volume stood at 15,373 lots of 25 tonnes each, higher than the usual 12,500 lots.
Technical analysis showed that Malaysian palm oil may test a resistance of 2,449 ringgit per tonne, a break above which will lead to a further gain to 2,522 ringgit, said Reuters market analyst Wang Tao. (Full Story)
Weaker winter demand from Europe and China had taken a toll on palm oil exports, causing shipments to fall more than 20 percent in the first 15 days of January. Palm oil tends to solidify in cold temperatures.
But with warmer weather on its way, traders expect demand to pick up in the coming weeks ahead.
"Moving forward, it can only improve -- it will not go worse. The weather is getting warmer and you will see more imports going into China," the trader added.
Brent crude rose towards $111 a barrel on Wednesday on hopes of a revival in demand growth in the world's top oil consuming nation after U.S. retail sales beat forecasts and oil inventories there rose far less than what was expected. O/R
U.S. soyoil for March delivery BOH3 was almost flat in early Asian trade. The most active May soybean oil contract DBYcv1 on the Dalian Commodity Exchange edged up 0.1 percent.

Indonesia rules out changes to palm export tax structure
JAKARTA | Wed Jan 16, 2013 2:18am EST
Jan 16 (Reuters) - Indonesia, the world's biggest palm oil producer, will not change its export tax structure for the edible oil or follow rival producer Malaysia by cutting tariffs on crude grades to zero, the trade minister said on Wednesday.
"Indonesian government will not change the palm oil export tax structure although Malaysia has been lowering its CPO export tax to zero percent," Trade Minister Gita Wirjawan said.
"We have set up a progressive palm oil export structure in line with our policy to boost the palm oil downstream industry," he added. "Although the Malaysian government has lowered its CPO export tax to zero percent, we will not be."
Malaysia, the world's No.2 palm oil producer, set at zero export taxes for crude palm oil for January and February after announcing last year that it would set duties -- formerly at 23 percent -- on a monthly basis.
The Malaysian tax changes were aimed at clawing back market share from Indonesia, which in 2011 slashed export taxes on refined palm oil in a bid to boost its processing and downstream industries.
Industry group the Indonesian Palm Oil Association (GAPKI) has repeatedly called for a reduction in palm oil export taxes to provide greater parity against Malaysian competitors.
But on the downstream and processing side, the Indonesian Vegetable Oil Association says it wants to keep things as they are to maintain consistency.
Indonesia reduced its export tax on crude palm oil to 7.5 percent for January from 9 percent in December.
Last month, a junior minister in Indonesia's trade ministry said his department was resisting pressure from parts of the palm oil industry to change its export tax system in response to planned tax cuts by Malaysia.

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