RTRS:VEGOILS-Palm rises near 5-mth high, retreats on euro zone fears
* Euro zone debt jitters remain to hold back palm prices
* Monsoon and La Nina weather to hit output in coming months
* Benchmark prices rise 0.4 percent to 3,209 ringgit peak
By Michael Taylor
JAKARTA, Nov 15 (Reuters) - Malaysian palm oil futures
eased slightly on Tuesday after rising to their highest level in
nearly five months as lingering concerns about the euro zone's
debt offset robust demand and expectations of falling output.
Benchmark January palm oil futures on the Bursa
Malaysia Derivatives Exchange traded 0.2 percent lower at 3,190
Malaysian ringgit ($1,017) per tonne. Prices earlier touched a
peak at 3,209 ringgit, a level not seen since June 22.
Traded volumes for the January palm contract were at 6,549
lots of 25 tonnes each, compared with 7,476 lots on Monday.
"Europe is on everyone's mind -- what will eventually happen
is anybody's guess," said a Kuala Lumpur-based palm trader. "But
we have China's insatiable demand and supply constraints ...
November and Dec are low production months."
Asian shares also fell on Tuesday as a rise in euro zone
bond yields reflected lingering doubts about the ability of
politicians in Italy and Greece to push through painful reforms
to resolve their debt crises and win market confidence.
In related markets, U.S. soyoil for December delivery
rose in Asian trade, while China's most active May 2012 soybean
oil contract <0#DBY:> also climbed slightly.
Brent crude futures rose above $112, recouping some of the
previous session's fall of more than $2, while concerns over
Europe slipping into a recession and hurting oil demand growth
capped the gains.
Malaysian palm oil is expected to fall to 3,100 ringgit, as
indicated by its wave pattern and the RSI indicator, Reuters
analyst Wang Tao said.
Benchmark palm prices have fallen about 15 percent this
year, partly due to the uncertain macro and sovereign debt
picture and demand outlook.
Palm oil sentiment is improving, despite the economic
outlook, due to lower production expectations from the fourth
quarter, as dominant Southeast Asian producers enter the rainy
season and the La Nina weather pattern seen
returning.
At the same time, palm oil demand is seen rising in top
buyers India and China. Exports of Malaysian palm oil products
for Nov 1-15 rose 10.5 percent, cargo surveyor Intertek Testing
Services said.
"The ITS export data is a bit higher than what most people
were talking about yesterday," said another Kuala Lumpur trader.
"We saw a little bit of profit-taking earlier, but it looks
like the price should hold or move higher later."
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
