Vegoils: Palm oil climbs 4% to record high as edible oil supply tightens

MMTec

12/05/2021 06:23

* Palm surpass 4,500 ringgit to hit a record high 
    * Palm gains for a second consecutive week 
    * Upcoming USDA report likely to show tightening global
supply 

 (Updates with closing prices, adds quotes)
    By Mei Mei Chu
    KUALA LUMPUR, May 12 (Reuters) - Malaysian palm oil futures
ended 4% higher on Wednesday to hit a record peak of 4,524
ringgit ($1,096.20) a tonne, helped by concerns of tight global
edible oil supply and on trader positioning ahead of a key U.S.
report for grains and soybeans.
    The benchmark palm oil contract  FCPOc3  for July delivery
on the Bursa Malaysia Derivatives Exchange ended higher by 174
ringgit at the midday close. 
    The contract extended last week's rally to notch a 2.2%
weekly rise.
    The Malaysian bourse will remain closed for Eid
celebrations, and resume trade on May 17.
    Palm oil surged in unison with Chicago Board of Trade and
the Dalian Exchange, and prices were defensive as May output
could rise marginally due to lack of manpower to harvest, said
Paramalingam Supramaniam, director at Selangor-based brokerage
Pelindung Bestari.
    "The situation is so tight that refiners are buying back
olein in the market to fulfill their sales obligation, with
crude palm oil arrivals from the millers grinding to a halt," he
added. 
    Traders are now expecting the World Agricultural Supply and
Demand Estimates report due later in the day to show a supply
squeeze until 2022. 
    The U.S. Department of Agriculture (USDA) will give its
first global outlook for grains and soybeans in 2021/22 and
update its 2020/21 estimates in the report.  urn:newsml:reuters.com:*:nL1N2MX1P2
    Palm oil is also being supported by a rally in the global
agricultural market, led by Chicago corn and soybean futures,
which are trading at multi-year highs.
    Dalian's most-active soyoil contract  DBYcv1  and its palm
oil contract  DCPcv1  both advanced 3%. Soyoil prices on the
Chicago Board of Trade  BOcv1  were up 1.4%.
    The edible oil is affected by price movements in related
oils as they compete for a share in the global vegetable oils
market.
    Palm oil is poised to break a resistance at 4,436 ringgit
per tonne and rise into a range of 4,494 ringgit to 4,556
ringgit, Reuters technical analyst Wang Tao said.  TECH/C 
    
    

    ($1 = 4.1270 ringgit)

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p1    https://tmsnrt.rs/3uBs0x0
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 (Reporting by Mei Mei Chu; Editing by Sherry Jacob-Phillips)
 ((Meifong.chu@thomsonreuters.com))
 
((For a table on Malaysian physical palm oil prices, including refined oil, Reuters Terminal users can double click on or type  OILS/MY01 .
* To view freight rates from Peninsula Malaysia/Sumatra to China, India, Pakistan and Rotterdam, please key in  OILS/ASIA2  and press enter, or double click between the brackets. 
* Reuters Terminal users can see cash and futures edible oil prices by double clicking on the codes in the brackets: To go to the next page in the same chain, hit F12. To go back, hit F11.
Vegetable oils                        OILS/ASIA1 
Malaysian palm oil exports            SGSPALM1   
CBOT soyoil futures                   0#BO:      
CBOT soybean futures                  0#S:       
Indian solvent                        SOLVENT01  
Dalian Commodity Exchange             DC/MENU   
Dalian soyoil futures                 0#DBY:   
Dalian refined palm oil futures       0#DCP:   
Zhengzhou rapeseed oil                0#COI:   
European edible oil prices/trades     OILS/E    ))