KUALA LUMPUR, March 10: Malaysian crude palm oil futures ended lower on Thursday, dragged down by news of a build-up in domestic stocks and concerns of slower exports.
Official data released at midsession showed that end-February stocks rose 1.5 per cent to 1.54 million tons from a month earlier. Exports fell 7 per cent to 933,406 tons.
This is surely one of the highest stock levels in years, said one trader. I don’t know how we’ll cope if production picks up next month and if the freight situation gets tighter.
At the close, the benchmark third-month crude palm oil futures on Bursa Malaysia Derivatives, May, fell 0.8 per cent at 1,426 ringgit ($375.26) a ton after a high of 1,441.
Traders expect prices to remain within the 1,400-1,450 ringgit range in the near-term as upside potential was limited by softening exports despite support from rival soyaoil.
I think we will be trading in this range only as the fundamentals for exports are not really in our favour despite the way soya prices are going, said a trader.
Finding vessels for palm oil had become harder in the last fortnight as freight rates continued to rise along with bunker oil prices and competition for cargo space intensified from exporters of fuel products, shippers said.
It’s virtually impossible to get a vessel now for prompt palm oil shipment, said a freight broker. And it’s tight till May, even if you want to pay.
Societe Generale de Surveillance, one of the surveyors of Malaysian oil palm cargoes, said on Thursday exports for March 1, to 10 fell 0.2 per cent to 377,407 tons from Feb 1 to 10. —Reuters
