Palm | Kelapa Sawit

* Drought woes in South America and firm demand limit losses
    * Price correction after palm oil hits one-year high on
Tuesday
    * USDA quarterly inventory report and planting forecast due
Friday

 (Updates prices)   
    By Chew Yee Kiat   
    SINGAPORE, March 29 (Reuters) - Malaysian palm oil futures
slipped for a second day on Thursday, as traders booked more
profit from a rally this week, although losses were curbed by
soybean supply fears in South America and firm export outlook
for palm oil.   
    Palm oil could not breach the psychological 3,500 ringgit
level this week, especially when market players were cautious
ahead of the U.S. Department of Agriculture's quarterly
inventory report and planting forecast due on Friday.    
    "We see that palm oil prices have come to a one-year high,
so it's not surprising that some profit-taking activities start
to kick in, especially now as we are at the end of the month,
some book squaring is going to happen," said Ker Chung Yang, an
analyst at Phillip Futures in Singapore.     
    "There could be some positioning ahead of this coming
Friday's reports. Although the market is speculating that there
could be more planted acres for corn, the reports could turn out
to be a surprise and soybean prices could subsequently be
weighed on that."   
    Benchmark June palm oil futures on the Bursa
Malaysia Derivatives Exchange closed down 0.5 percent at 3,456
ringgit ($1,127) per tonne. This week the market went as high as
3,497 ringgit, a level unseen since March 10 2011.     
    Traded volumes were thin at 20,280 lots of 25 tonnes each,
compared to the usual 25,000 lots.   
    Palm oil investors are watching closely on the acreage
battle between corn and soybean because a smaller planted area
for soybean could boost demand for palm oil, which competes with
crushed soybean oil in the vegetable oil market.    
    Malaysian export data for the first 25 days of March pointed
to an improvement in buying interest for the tropical oil
compared to a month ago, and traders are expecting exports for
the full month to end higher.     
    Market players are also focusing on Malaysia's palm oil
supply, which could be lower in March on the back of seasonality
and the effect of biological stress.
    A lower palm oil production may push up prices further as
global oilseed supply is tight especially as a drought in South
America has disrupted soybean production.   
    Oil prices held near $124 a barrel on Thursday on concerns
about the loss of Iranian oil despite the prospect of a release
of strategic oil reserves in the West and renewed promises of
additional supply from Saudi Arabia.    
    In other vegetable oil markets, the most active U.S. soyoil
contract for May lost 0.1 percent in Asian trade while
the most active September 2012 soyoil contract on
China's Dalian Commodity exchange was trading down 0.8 percent.    
       
  Palm, soy and crude oil prices at 1004 GMT
                                                                                               
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR2    3483   -17.00    3465    3500     214
  MY PALM OIL      MAY2    3465   -17.00    3451    3483    1971
  MY PALM OIL      JUN2    3456   -17.00    3445    3477   11141
  CHINA PALM OLEIN SEP2    8664   -66.00    8620    8734  241496
  CHINA SOYOIL     SEP2    9642   -74.00    9606    9722  589938
  CBOT SOY OIL     MAY2   54.57    -0.03   54.44   54.83    8184
  NYMEX CRUDE      MAY2  104.92    -0.49  104.89  105.70   16785
                                                                                               
  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
 ($1=3.066 ringgit)   
   
 (Editing by Niluksi Koswanage)

* China may replenish food stocks, boost demand outlook
    * Prices up 9.4 pct so far this year
    * March production could be lower on biological stress

 (Updates throughout)   
    By Chew Yee Kiat   
    SINGAPORE, March 28 (Reuters) - Malaysian palm oil futures
closed down on Wednesday as traders booked profits from a
one-year high hit the previous day, although losses were limited
by news of larger food imports by China and soybean crop damage
in South America.   
    Palm oil has gained 9.4 percent so far this year with 3,500
ringgit level within striking distance although many in the
market say the run-up is too speculative.    
    Commodity traders are facing a choppy week as the focus
turns to the U.S. Department of Agriculture's quarterly
inventory report and planting forecast due on Friday.    
    "Market players are looking out for the USDA reports on
Friday. At the same time, food demand from China is quite strong
as it is replenishing its stocks," said a trader with a foreign
commodities brokerage in Malaysia.    
    Benchmark June palm oil futures on the Bursa
Malaysia Derivatives Exchange edged down 0.2 percent to close at
3,473 ringgit ($1,134) per tonne. Prices touched a
more-than-one-year high level of 3,497 ringgit on Tuesday.    
    Traded volumes stood at 20,004 lots of 25 tonnes each,
thinner than the usual 25,000 lots as investors were wary ahead
of the Friday reports.   
    A healthy demand outlook for palm oil was supported by the
latest Malaysian export data, which pointed to a moderate
improvement in exports for the first 25 days of March.
     
    Traders are expecting March exports to be higher than
February, registering a first month-on-month increase since
October last year.    
    On top of that, market players are focusing on Malaysia's
palm oil supply, as lower crude palm oil production arising from
seasonally weaker yields could push prices up further.    
    Analysts said that the effect of biological stress could
kick in soon after 12 months of a strong production up-cycle and
that could lower palm oil production.    
    Brent crude fell for a second session on Wednesday, weighed
by the possibility of a release of strategic oil reserves by the
United States and European nations.    
    In other vegetable oil markets, the most active U.S. soyoil
contract for May gained 0.1 percent in Asian trade after
China snapped up U.S. soy cargoes following tight supplies in
drought-hit south America.
    The most active September 2012 soyoil contract on
China's Dalian Commodity exchange was trading 0.2 percent lower.   
       
  Palm, soy and crude oil prices at 1015 GMT
                                                                                 
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      APR2    3495   -17.00    3495    3515     154
  MY PALM OIL      MAY2    3482    -3.00    3467    3499    3243
  MY PALM OIL      JUN2    3473    -8.00    3463    3494   11503
  CHINA PALM OLEIN SEP2    8716   -16.00    8676    8774  233098
  CHINA SOYOIL     SEP2    9702   -22.00    9670    9764  548878
  CBOT SOY OIL     MAY2   55.17    +0.07   54.96   55.35    6704
  NYMEX CRUDE      MAY2  106.29    -1.04  106.22  106.94   16520
                                                                                 
  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
   
($1=3.062 ringgit)   
   
 (Editing by Niluksi Koswanage)

http://www.reuters.com/article/2012/03/28/markets-vegoils-idUSL3E8ES36Q20120328