VEGOILS-Palm oil inches up ahead of industry data

Thu Aug 9, 2012 11:16am BST

 * Malaysia palm stocks to climb to 5-month high in July
-survey
 * Traders eye MPOB and USDA data on Friday for new cues
 * Malaysia Aug 1-10 export data also due on Friday

 (Updates prices)
 By Chew Yee Kiat
 SINGAPORE, Aug 9 (Reuters) - Malaysian crude palm oil
futures recovered a little on Thursday from a near 8-week low
hit the previous day, although traders remained cautious ahead
of a slew of key industry reports that could stir more market
volatility.
 The U.S. Department of Agriculture (USDA) will release its
monthly supply and demand report on Friday that is likely to
show a cut in estimates for new-crop soy output, potentially
limiting edible oil supply and shifting some demand to palm oil.
 Traders are looking out for the July stocks data from the
Malaysian Palm Oil Board (MPOB), which is likely to have reached
a five month high and could help shore up a deficit in global
vegetable oil supply. 
 "(Palm oil) futures are a little bit oversold so we are
expecting some technical pullback. But upside potential is very
limited as long as Malaysian stocks remain on the high side,"
said a trader with a local commodities brokerage in Malaysia. 
 The benchmark October palm oil futures on the Bursa
Malaysia Derivatives Exchange ended 0.1 percent higher at 2,865
ringgit ($923) per tonne. Prices touched a low of 2,854 ringgit
on Wednesday, a level last seen on June 15.
 Total traded volumes were thin at 20,741 lots of 25 tonnes
each, compared to the usual 25,000 lots.
 Malaysian palm oil stocks likely climbed in July to their
highest since February as exports slow and production rises,
snapping four straight months of declines, a Reuters survey
showed on Wednesday. 
 Cargo surveyors Intertek Testing Services and Societe
Generale de Surveillance will release exports data for the Aug
1-10 period also on Friday.  
 Palm oil exports suffered a double-digit decline in July as
festival demand eased, cargo surveyor data showed. Traders are
now pinning their hopes on the recently announced tax-free crude
palm oil export quotas of 2 million tonnes to help reduce stocks
in coming months.
  The industry is also watching out for a possibility of El
Nino returning to Southeast Asia, as the hot and dry weather
pattern could damage palm oil yields for top producers Indonesia
and Malaysia. 
 Oil prices steadied around $112 a barrel on Thursday as
sobering production and consumption data from China weighed on
the demand outlook, but prices remained elevated due to supply
disruptions in the Gulf of Mexico and lower Brent output. 
 Other vegetable oil markets traded higher ahead of the USDA
report on Friday.
 By 1004 GMT, the most active U.S. soyoil contract for
December delivery had edged up 0.5 percent and the most
active January 2013 soyoil contract on the Dalian
Commodity Exchange jumped 1.4 percent.    
 
  Palm and soy oil prices at 1005 GMT
                                                                                           
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      AUG2       0    +0.00       0       0       0
  MY PALM OIL      SEP2    2827    +6.00    2820    2851     892
  MY PALM OIL      OCT2    2865    +2.00    2860    2894   14220
  CHINA PALM OLEIN JAN3    7854   +80.00    7778    7860  236606
  CHINA SOYOIL     JAN3    9696  +130.00    9572    9706  737660
  CBOT SOY OIL     DEC2   52.65    +0.26   52.30   52.94    8236
                                                                                           
  Palm oil prices in Malaysian ringgit per tonne
  CBOT soy oil in U.S. cents per pound
  Dalian soy oil and RBD palm olein in Chinese yuan per tonne
  ($1=3.104 Malaysian ringgit)

 (Editing by Niluksi Koswanage)
 
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