RTRS:VEGOILS-Palm dips to new two-week lows on economic gloom
* Heavy rains trigger floods in key palm oil producing
regions
* Technicals more bearish with lower price target
* Nov 1-25 exports slip 4.3 percent - ITS
* Production could fall 15 pct this Nov-planters
By Chew Yee Kiat
SINGAPORE, Nov 25 (Reuters) - Malaysian palm oil
futures fell to a fresh two week lowest on Friday as weak global
economic sentiment overshadowed slowing production on the back
of seasonal decline in yields and La-Nina driven rains.
Fears of a slowing global growth and a worsening euro debt
crisis have seen palm oil futures notch five straight sessions
of losses. An ongoing market correction played a part in the
declines.
"The market has been rallying for more than 300 ringgit. So
for the last few days, there had been some profit taking in the
market," said a trader with a foreign commodities brokerage in
Kuala Lumpur.
"Probably later part in the afternoon we will see some
short-covering ahead of the long holiday," he added, referring
to the Muslim festival on Monday.
By the midday break, benchmark February palm oil futures
on the Bursa Malaysia Derivatives Exchange edged down
0.4 percent to 3,095 ringgit ($972) per tonne. Prices fell as
low as 3,081 ringgit, a level last seen on Nov. 10.
Overall traded volumes stood at 6,169 lots of 25 tonnes
each, much thinner than the usual 12,500 lots as investors
stayed cautious.
Technicals remained bearish as Reuters analyst Wang Tao
lowered his price target to 3,037 ringgit from the previous
3,050 ringgit per tonne as indicated by a head-and-shoulders
pattern.
The Malaysian Meteorological Department website showed rains
had cleared up in key oil palm growing areas for the time being.
But it had ealier kept an orange stage warning that heavy
rains could persist till Friday and trigger floods in parts of
Pahang -- key oil palm growing area that accounts for 15 percent
of production.
Planters are looking at November palm oil prodution falling
by 10-15 percent on heavy monsoon rains and a seasonal decline
in yields.
This may support palm oil prices as heavy rains tend to
reduce harvesting rounds in oil palm estates and floods will
complicate the transport of the edible oil to mills and
refineries.
Exports have started to come off a little, according to a
cargo surveyor, and any further declines may give some relief to
tightening stocks.
Cargo surveyor Intertek Testing Services also said Malaysian
exports for Nov. 1-25 dropped 4.3 percent to 1.33 million,
compared to the 1.40 million tonnes shipped out a month ago.
Another cargo surveyor Societe Generale de Surveillance will
release its data later on Friday.
In other markets, Brent crude held steady above $107 on
Friday as nagging concerns about a euro zone debt crisis
contagion offset threats to supply emerging from France's call
for sanctions on Iran's oil exports.
Unfavourable global sentiment steeming from the debt crisis
weighed on other vegetable oil markets. U.S. soyoil for December
delivery lost 1.0 percent while China's most active May
2012 soybean oil contract <0#DBY:> dropped 0.2 percent.
Palm, soy and crude oil prices at 0442 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC1 3107 -11.00 3107 3119 23
MY PALM OIL JAN2 3102 -11.00 3087 3113 810
MY PALM OIL FEB2 3095 -13.00 3081 3114 3294
CHINA PALM OLEIN MAY2 7826 +26.00 7704 7854 143066
CHINA SOYOIL MAY2 8690 -20.00 8580 8708 343422
CBOT SOY OIL DEC1 48.86 -0.46 48.36 49.17 2971
NYMEX CRUDE JAN2 96.62 +0.45 95.64 97.31 27207
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
Crude in U.S. dollars per barrel
