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NEWS ADMIN

Mahamad Rodzi Abdul Ghani

DATE

08/03/2002

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Mahamad Rodzi Abdul Ghani

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NULL

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HEADLINE

MALAYSIAN PALM OIL SEEN AT 900-1,200 RGT IN 2002
KUALA LUMPUR, March 8 (Reuters) - Malaysia's crude palm oil futures willtrade within a range of 900 to 1,200 ringgit ($237-$316) a tonne this yearwith high global soy crop and lower Indian imports keeping a lid on price,a leading Indian trader said on Friday."I forecast that CPO prices will range between a high of 1,200 ringgitand a low of 900. We are likely to see the highs in the earlier part ofthe year and the lows firstly around June and then again aroundSeptember," said Dorab Mistry, director of Godrej International Ltd."Once again this year, we are faced with huge soya crops in Brazil andArgentina. We also have an extremely competitive currency in Argentinathat should give Argentine soyoil exporters a big advantage," he told anedible oil conference.Mistry expected prices of refined, bleached and deodorised (RBD) palmolein to range between $280 and $350 a tonne FOB Malaysia this year.Soyoil is a direct competitor to palm oil.Malaysia's benchmark third-month May crude palm oil futures contract crude palm oil futures closed up four ringgit at 1,170 ringgit($307.89) a tonne on Thursday.Hamburg-based newsletter Oil World said this week global soyoil stockswill reach a record 3.32 million tonnes on April 1, 2002, up from 3.07million tonnes on the same day in 2001.Soyoil stocks in the U.S., Argentina and Brazil, the world's mainproducers, are estimated at a combined 1.53 million tonnes as of April 1,up from 1.48 million tonnes a year ago, it said."Come May and June, we shall witness the famous Latin Armada of soyoilvessels. It is true that some of the large surplus of soyoil will berequired to fill the void left by lower sunoil production," said Mistry."However, the soya crop in Brazil and Argentina is bigger than the mostoptimistic estimates," he added.

CHINA DOMINATES SCENEIndia, the world's largest edible oil importer, was likely to buy lessoil in 2001/2002 (November-October) because of the country's economicdownturn, a meagre increase in per capita consumption and high domesticprices, said Mistry.India also expects to see higher domestic oils production. Groundnutoil output, for instance, was estimated to touch 1.54 million tonnes in2001/02, up from 1.02 million tonnes in 2000/01."I expect meagre growth in per capita consumption this year from 12.15to 12.2 kilos. Higher production, a smaller pipeline and higher localprices will cut imports to 4.68 million tonnes," said Mistry.India's edible oil imports reached 5.4 million tonnes in 2000/01, upfrom 5.0 million tonnes in 1999/00, he said.Mistry said China would also play a role in determining marketdirection."We must accept that China dominates the scenario this year. Chinadominates not because it is the biggest importer, but simply because itremains an enigma," he said.In December, Mistry said prices could touch 1,300 ringgit in the firstquarter of this year, partly because of China's entry to the World TradeOrganisation (WTO), which allows it to import 2.4 million tonnes of palmoil, up from last year's 1.4 million tonnes.