RTRS:VEGOILS-Palm oil off 3-week high on larger soy crop, economy
* Palm oil touches highest since Sept 27
* Exports up first 15 days of Oct, driven by CPO shipments
* Markets under pressure after German finmin comment
(Updates prices)
By Niluksi Koswanage
KUALA LUMPUR, Oct 17 (Reuters) - Malaysian palm oil futures
ended down 1.3 percent on Monday, falling sharply from an
earlier three-week high after comments from the German finance
minister and also on expectations of a larger U.S. soybean crop
for crushing into edible oil.
Palm oil prices, which gained five percent last week, came
under pressure along with other commodities after Germany's
Finance Minister said European governments would not present an
ultimate solution for the debt crisis this week.
"You can't be too bullish in these market conditions," said
a trader in futures brokerage in Malaysia.
"Everything is very fluid and the threat of the global
economy coming under strain is always at the back of your mind.
That also applies to soyoil markets with the higher soy acreage
in the U.S," the trader added
Benchmark January palm oil futures FCPOc3 on the Bursa
Malaysia Derivatives Exchange rose as much as 1.1 percent to
2,946 ringgit -- the highest since Sept. 27.
The contract then gave up all its gains and more to settle
1.3 percent lower at 2,876 ringgit, with sell orders coming in
the last minute.
Export data is expected to strengthen in the coming weeks as
mostly Muslim countries and China re-stock after major public
holidays and India continues to buy ahead of Diwali at the end
of this month.
Cargo surveyor Intertek Testing Services said over the
weekend Malaysian exports for Oct. 1-15 rose 11.9 percent to
725,456 tonnes, driven by higher crude palm oil shipments.
Another cargo surveyor, Societe Generale de Surveillance
said exports in the same period rose 10.2 percent to 719,575
tonnes.
"The buying of crude palm is going at a steady pace.
Overseas buyers are flocking to Malaysia that has a tax free
crude palm oil export quota," said another trader in Malaysia.
"Exporting Indonesian crude palm oil is expensive compared
to that of refined palm oil and there is some opportunity for
Malaysia," he added.
Buyers swooping in to buy Malaysia crude palm oil could cut
stocks in the world's second largest producer of the vegetable
oil that rose to a 21-month high in September above 2 million
tonnes.
But some market players are concerned that production will
continue to be strong and boost stocks to at least 2.4 million
tonnes at the end of the year -- part of the reason for the
decline in the futures market.
Brent crude turned negative and U.S. crude pared earlier
gains on Monday following the German remarks.
Lower crude further weighed on U.S. soyoil for December
delivery , which dropped 0.9 percent in Asian trade.
The soy complex has come under pressure after Analytical
firm Informa Economics raised its forecast of U.S. 2012 soybean
seedings to 77.0 million acres from its previous projection of
75.8 million.
China's most active May 2012 soybean oil contract <0#DBY:>
climbed 0.4 percent on restocking demand after the Golden Week
holidays in early October.
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil in Chinese yuan per tonne
Crude in U.S. dollars per barrel
($1 = 3.127 ringgit)
(Editing by Michael Urquhart)
((Reporting by Niluksi
Koswanage)(niki.koswanage@thomsonreuters.com)(+603 2333
8035)(Reuters
Messaging:)(niki.koswanage.thomsonreuters.com@thomsonreuters.net
