VEGOILS - Palm flat ahead of MPOB and exports; demand concerns weigh

Malaysian palm futures were in a narrow range on Monday, ahead of important data on the country’s stocks. Weak demand from key markets was offset by gains due to flood fears and Indonesia’s potential increase in export taxes.

At the midday break, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange for April delivery fell 7 ringgit or 0.16% to 4,497 Ringgit ($1,006.72) per metric ton.

Anilkumar bagani, commodity researcher at Mumbai's Sunvin Group, explained that crude palm oil futures were trading sideways before the Malaysian Palm Oil Board data. This was due to short-covering following Friday's gains. The market was also affected by concerns about flood-related disruptions and speculations that Indonesia could increase its palm export levies.

Bagani said that demand from the key destinations markets was still sluggish.

Dalian's palm oil contract grew by 2.05%, while the most active soyoil contract increased by 0.32%. Chicago Board of Trade soyoil prices fell 0.74%.

As palm oil competes to gain a share in the global vegetable oil market, it tracks the price changes of competing edible oils.

Later in the day, cargo surveyors will release estimates of Malaysian palm oil imports for the period February 1-10.

Oil prices rose as investors considered the latest tariff threat from U.S. president Donald Trump - this time on steel and aluminum imports. This could slow global economic growth and reduce energy demand.

Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.

Palm's ringgit, its currency of trade, fell 0.65% in value against the U.S. Dollar, making it cheaper for buyers with foreign currencies.

Technical analyst Wang Tao suggested that palm oil could rise to 4,591 Ringgit per metric tonne as indicated by a retracement and a falling trend.

(source: Reuters)