Palm rebounds from 3-week low

Published: 2009/05/23

CPO FUTURES

JAKARTA: Malaysian palm futures rose nearly 1 per cent yesterday, rebounding from a three-week low a day earlier, but fears over supplies in the world’s number-two producer and a strong ringgit capped gains, traders said.

The benchmark August contract on the Bursa Malaysia’s Derivatives Exchange rose RM23, or 0.9 per cent, to RM2,522per tonne, after posting its biggest day-fall in more than three weeks on Thursday.Despite the rebound, the benchmark price closed down 5.4 per cent this week, its biggest weekly loss since the end of February. Palm has struggled to hold onto gains after after rising more than 50 per cent this year.

“Prices can only move when someone starts buying and somebody starts selling on the physical side. Unfortunately, sellers don’t have cargoes to sell. In the end (the) market is just stuck like this,” said a trader at a Malaysian commodities brokerage.

The trader said unless production shows signs of improvement, price could drop further in coming weeks.“Everybody is still trying to sell. At current prices above RM2,500, it is still good to sell,” he said.In the Malaysian physical market, palm oil for May and June was traded at RM2,590-RM2,600 per tonne in the southern and central region. There was no trades on Thursday.

RUBBER

THE Malaysian rubber market closed easier yesterday on lack of buying interest, dealers said.They said the market sentiment was dampened by the continued losses on the Tokyo rubber futures.

"The market was relatively quiet as players were also reluctant to participate actively in the market due to a lack of fresh leads," a dealer said. At noon, the Malaysian Rubber Board's official physical price for tyre-grade SMR20 fell 3.5 sen to 559 sen per kg and latex in bulk dropped 2.5 sen to 412 sen per kg.

The unofficial physical price for tyre-grade SMR 20 declined four sen to 557 sen per kg and latex in bulk slipped 2.5 sen to 411 sen per kg.

TIN

THE Kuala Lumpur Tin Market (KLTM) rose by US$40 to close at US$13,860 per tonne yesterday on strong demand, especially from European and Japanese buyers, dealers said.They said the local tin price extended its gains despite the sharp fall of the tin price on the London Metal Exchange (LME).

The LME tin price, which normally influences global tin prices, dropped US$445 to US$13,305 per tonne. At the opening level, buyers bid for 100 tonnes while sellers offered 87 tonnes.

Turnover on the KLTM increased to 95 tonnes from 87 tonnes yesterday with activities dominated by Japanese, European and local traders. The price differential between the KLTM and LME widened to a premium of US$785 per tonne from US$300 per tonne on Thurday. - Agencies