Palm oil price rises to 19-month high

Banks and plantations were among the top losers.

KUALA LUMPUR: Malaysian palm oil futures rose for a third straight session on Wednesday to hit their highest level in 19 months on tighter supplies.
    The palm oil contract for April on the Bursa Malaysia Derivatives Exchange rose as much as 1.41 percent in afternoon trade to touch its highest level since June 25, 2014 at 2,510 ringgit ($590.17) per tonne, before settling up 1.1 percent at 2,502 ringgit. 
    Traded volume stood at 62,044 lots of 25 tonnes each. 
    "The market will hold... The reason is tight availability of
crude palm oil. Moving forward there will be a production
decline and stocks are manageable," said a trader with a Kuala
Lumpur-based brokerage that deals in palm oil. 
    Palm oil output growth may decline this year in Southeast
Asia as dry weather caused by the El Nino weather phenomenon
affects fresh fruit yields and lowers productivity. 
    Malaysian palm output will rise only 0.7 percent in 2016
from a year ago to 20.1 million tonnes, the Malaysian Palm Oil
Board is forecasting. Indonesia, the world's biggest palm-oil
producer, will see exports drop to about 23-24 million tonnes,
the Indonesian Palm Oil Association has predicted, the first
decline in five years as supply is directed to domestic uses. 
    Palm oil shipments from Malaysia have fallen about 8 percent
so far this month, according to data from cargo surveyors, on
slowing economic growth in top consumer China.
  
    Stockpiles in Malaysia as of end-December were at 2.6
million tonnes, down from an all-time high of 2.9 million tonnes
a month ago.
    In related markets, crude oil prices  fell to
around $30 per barrel on a surprise rise in U.S. inventories,
which could take a drag on palm oil prices as the vegetable oil
is used for blending into fuel for biodiesel. 
    The U.S. March soyoil contract gained 0.2 percent,
while the May soybean oil contract on the Dalian
Commodity Exchange rose 0.6 percent.
    
  Palm, soy and crude oil prices at 1017 GMT
                                                                     
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      FEB6    2413   +26.00    2380    2414     533
  MY PALM OIL      MAR6    2476   +29.00    2439    2481    4538
  MY PALM OIL      APR6    2502   +27.00    2463    2510   27834
  CHINA PALM OLEIN MAY6    4750   +76.00    4686    4750 1084532
  CHINA SOYOIL     MAY6    5642   +36.00    5586    5644  617330
  CBOT SOY OIL     MAR6   30.80    +4.10   30.57   30.93    5291
  INDIA PALM OIL   JAN6  433.00    +4.10  429.50  433.60    1178
  INDIA SOYOIL     FEB6  612.20    +2.85  610.00  613.60   23590
  NYMEX CRUDE      MAR6   30.24    -1.21   30.14   31.22   83043
                                                                     
  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
  India soy oil in Indian rupee per 10 kg
  Crude in U.S. dollars per barrel
 
($1 = 4.2530 ringgit)
($1 = 68.0300 Indian rupees)
($1 = 6.5779 Chinese yuan)   - Reuters