Refined Soybean Oil (December contract) futures closed higher on winter season demand and firm overseas market on Monday.
The USDA’s Weekly export reports showed that the net oil sales were 19,200 tonnes, 16,000 tonnes of it by Mexico, and all of it was for the current marketing year. Cumulative soybean oil sales stand at 46.6% of the USDA forecast for 2009/10 versus a 5 year average of 24.3%.
The Indian Agriculture Ministry reported that India’s vegetable oil output is expected to decline 7.4 per cent to 7.96 million tonnes (Mn T) in the 2009-10.
The demand of edible oil in the country is estimated to have increased to 17.79 million tonnes this year, he stated.
Technical Analysis
Ref Soy Oil Prices (NCDEX December Contract) closed higher at 501.50 per 10 Kg on Monday; its high of the day was 502.35 levels and touched a low 489.00 level.
Prices closed above its 10 day and below its 20 day EMA. 14-Day RSI is at 66.40, which is in neutral zone.
Outlook
Refined soy oil futures are expected to trade higher on account of firm overseas market and winter season demand (for short term). However, in the long term perspectives prices are expected to move southwards on account of huge stock of imported edible oil this year as compared to last year and decision of continue to import of crude edible oil at 0% also in favor of bears in the market.
