Palm | Kelapa Sawit

Palm oil declined on concern that stockpiles in Malaysia, the second-largest grower, may increase as exports slow after the end of the festival season.
The November-delivery contract dropped 1.1 percent to 3,018 ringgit ($1,013) per metric ton on the Malaysia Derivatives Exchange. Futures gained 2.5 percent last week, the first increase in six weeks.
Shipments from Malaysia may ease as importers stocked up ahead of the Muslim festival of Eid, celebrated last week. Malaysia’s palm oil exports fell 0.6 percent to 1.62 million tons in August compared with the previous month, independent market surveyor Intertek said Sept. 2. Shipments dropped 0.5 percent in the month, Societe Generale de Surveillance estimated on Aug. 29.
“Exports will be lower, as pre-stocking was already done in July,” Arhnue Tan, senior investment analyst at ECM Libra Capital Sdn., said by phone from Kuala Lumpur today. “The resulting impact could see stock levels go up. This will be bad news” for prices, she said.
Stockpiles dropped to 2 million tons in July from 2.05 million tons in June, while exports rose 9.1 percent to a record 1.73 million tons, the Malaysian Palm Oil Board said on Aug. 10. Production slipped 0.1 percent to 1.75 million tons in July. The board is scheduled to release output, inventory and shipment data for August on Sept. 12.
“Exports for August were much lower than industry expectations,” said Vimala Reddy, an analyst at Karvy Comtrade Ltd., said by phone from the Indian city of Hyderabad. “Bulk demand for edible oil is gradually decreasing. The main festive season has already come to an end.”
Demand would pick up again in a month’s time as the Hindu Diwali festival is celebrated at the end of October, Reddy said.
Soybean futures for November delivery climbed 11.25 cents, or 0.8 percent, to $14.4575 a bushel in Chicago on Sept. 2, capping a weekly gain of 1.6 percent, the third straight. All U.S. markets and government offices are closed today, in observance of Labor Day.
Palm oil for May delivery on the Dalian Commodity Exchange shed 0.5 percent to close at 8,996 yuan ($1,408) per ton, while soybean oil for delivery in the same month fell 0.6 percent to 10,426 yuan a ton.