Palm Oil Advances as Malaysia’s Export Tax May Boost Shipments
The contract for March delivery climbed as much as 0.9 percent to 2,495 ringgit ($819) a metric ton on the Malaysia Derivatives Exchange, and ended the morning session at 2,481 ringgit. Futures are heading for a 0.6 percent loss this week.
Malaysia said Dec. 17 it will allow crude palm oil exports at zero duty in January as the second-largest producer seeks to reduce stockpiles that drove prices to a three-year low last month. Futures lost 23 percent last year as inventories gained for five straight months, reaching a record 2.56 million tons in November, according to the Malaysian Palm Oil Board.
“The most important thing people are paying attention to is how exports are going to be for January, February and March,” said Chandran Sinnasamy, head of trading at LT International Futures Sdn. in Kuala Lumpur. “Export estimates from Intertek and SGS on the 10th may give a rough idea whether the exports have improved with the new tax in Malaysia.”
Exports fell 5.7 percent to 1.57 million tons in December from 1.66 million tons a month earlier, surveyor Intertek said Dec. 31. Shipments dropped 7.9 percent to 1.52 million tons in the same period, Societe Generale de Surveillance estimated. Palm oil will trade sideways as concerns over high stockpiles in Malaysia and Indonesia still weigh on the market, said Chandran.
Soybeans for March delivery gained 0.3 percent to $13.9025 a bushel on the Chicago Board of Trade. Soybean oil for delivery in March was little changed at 50.68 cents a pound.
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