Trader's Comment: Palm oil futures trimmed some of its gain but remain in positive territory

Palm oil futures trimmed some of its gain but remain in positive territory, Benchmark Jan09 initially open RM51 higher at 1660, and hit the day high of 1696, tracking the rally of NYMEX crude oil when it advanced more than 4% higher during Asian time zone, boosted by China’s $586 billion stimulus plan to help sustain its growth. US eCBOT soy complex and Dalian palm also follow suit. Nevertheless, CPO prices was immediately drag down and hit the intra day low at 1612, after the release of export data by private cargo surveyor ITS and SGS which posted a fell of 5.3% and 9.0% respectively. Furthermore, official Oct supply and demand data released by MPOB, showed a record level of 2,086,452 tonnes of end stocks. These bearish news had provide suppressing pressure on CPO prices, even though other vegetable oil market had gained handsomely on the back of crude oil. However, supporting news such as the purchased of 30,000 tonnes of soy oil by China, and also the plan to buy 150,000 tonnes of palm oil by Thai government, provided some support at the lower end. Benchmark Jan09 then traded at a range of 1642-1618 for the rest of the day, and settled at 1626.