Malaysia's palm oil exports in March fall 3.1% from February to 1.2 million tonnes, hurt by weak demand from China and India, according to industry body

Nevin Barich

KARACHI, Pakistan , April 3, 2014 (South Asian Media Network) – Malaysian palm oil futures fell to their lowest in a month and a half on Monday, with prices recording their biggest monthly drop in over a year as disappointing export data stoked worries about slowing global demand for the vegetable oil. Cargo surveyor Intertek Testing Services (ITS) reported that Malaysia's palm oil exports in March fell 3.1 per cent to 1.21 million tonnes from a month ago, hurt by weak demand from the world's top edible oil buyers China and India. Another cargo surveyor Societe Generale de Surveillance showed that exports for the same period fell 3.4 per cent to 1.20 million tonnes shipped. A stronger Malaysian ringgit also made the ringgit-denominated feedstock more expensive for overseas investors and refiners, curbing buying interest. The ringgit rose 0.2 per cent to trade at 3.2660 against the U.S. dollar late Monday. "The weak exports are going to hold back the market," said a trader with a foreign commodities brokerage. "The strong ringgit is also a damper." The benchmark June contract on the Bursa Malaysia Derivatives Exchange had edged down 0.7 per cent to 2,636 ringgit ($808) per tonne by Monday's close. Prices earlier fell to 2,626 ringgit, their lowest since Feb. 12. Total traded volume stood at 36,123 lots of 25 tonnes, slightly higher than the average 35,000 lots. Benchmark palm prices have lost nearly 6 per cent in March, their biggest monthly fall since February 2013 as a crop-damaging dry spell eased and lacklustre exports stoked fears that key importers will switch to rival oils. But short supply for the crude grade, due to the earlier drought, has bolstered spot month prices for the April contract as well as crude palm oil sold on the physical Malaysian market. April prices rose to as high as 2,739 ringgit early Monday. In other markets, Brent crude oil traded near a two-week high around $108 a barrel on Monday as tension between Russia and the West offset a rise in oil supply from OPEC's second-largest producer Iraq. In competing vegetable oil markets, the U.S. soyoil contract for May edged up 0.3 per cent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodities Exchange lost 0.1 per cent Published by HT Syndication with permission from South Asian Media Network. For any query with respect to this article or any other content requirement, please contact Editor at htsyndication@hindustantimes.com

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