(Tweaks lead to reflect price change, updates prices)
* Prices post weekly gain of 0.9 pct, second in a row
* Stronger ringgit weighs, but palm still resilient - trader
* Palm oil targets 2,346 ringgit - technicals
By Anuradha Raghu
KUALA LUMPUR, Oct 18 (Reuters) - Malaysian palm oil futures ended higher on
Friday, reversing some losses in the morning session after the ringgit eased a
little, while hopes of only a slight rise in stocks lifted prices to post their
second weekly rise in a row.
Prices hit their highest in more than five weeks on Thursday on optimism
that output volumes in Malaysia, the world's second-largest producer, may not
surge as much as expected earlier, prompting investors to book profits.
The ringgit fell 0.1 percent to 3.1525 in late Friday trade, but
gained 0.8 percent this week, rising along other emerging Asian currencies after
U.S. lawmakers struck an 11th-hour deal to avoid a sovereign debt default.
Traders say the palm market is robust on prospects of a meek rise in
production growth in October, which along with strong demand could keep stocks
below 2 million tonnes in 2013.
"There's some pressure coming in from the strong ringgit -- but the current
level shows the market is quite resilient. It might try to go up to 2,450
ringgit," said a trader with a foreign commodities brokerage in Kuala Lumpur.
"Stocks could stay below 2 million tonnes this year. Output will peak next
month, but it will be a minimal rise."
By Friday's close, the benchmark January contract on the Bursa
Malaysia Derivatives Exchange had edged up 0.1 percent to 2,402 ringgit ($760)
per tonne. Prices earlier dipped to 2,378 ringgit.
Total traded volume stood at 28,174 lots of 25 tonnes each, lower than the
usual 35,000 lots.
Palm oil prices have risen 3.5 percent so far in October and posted a weekly
gain of about 0.9 percent, supported by healthy demand.
Cargo surveyor data showed that exports of Malaysian palm oil in the first
half of October rose to 781,043-799,853 tonnes, about 7-12 percent higher from a
month earlier as purchases from Europe and China increased.
"China won't stop importing palm because they are very price sensitive. The
price spread between soy and palm is still in favour of palm," the trader added.
Refined palm olein's discount to soyoil is currently around $119.
Market players will be waiting for export data for the Oct 1-20 period, due
on Oct. 21, to gauge demand.
Production from Indonesia, the world's top producer, could also be curbed
due to a government rule that limits plantation areas to just 100,000 hectares
for new palm oil firms, threatening an ambitious output goal of 40 million
tonnes by 2020, an industry group said on Friday.
Technicals were a little bearish. Malaysian palm oil may break support at
2,365 ringgit and fall further to 2,346 ringgit per tonne, as indicated by a
Fibonacci retracement analysis, Reuters market analyst Wang Tao said.
In other markets, Brent crude futures held steady at around $109 a barrel on
Friday after strong Chinese Q3 GDP data was offset by poor September oil demand
in the world's second largest oil consumer.
In competing vegetable oil markets, the U.S. soyoil contract for December
rose 0.3 percent in late Asian trade. The most-active January soybean oil
contract on the Dalian Commodities Exchange fell 0.1 percent.
Palm, soy and crude oil prices at 1023 GMT
Contract Month Last Change Low High Volume
MY PALM OIL NOV3 2394 +2.00 2374 2395 250
MY PALM OIL DEC3 2401 +7.00 2375 2401 4923
MY PALM OIL JAN4 2402 +3.00 2378 2404 16049
CHINA PALM OLEIN MAY4 6020 +30.00 5940 6034 429630
CHINA SOYOIL JAN4 7170 -4.00 7130 7192 299258
CBOT SOY OIL DEC3 41.45 +0.33 41.04 41.46 7377
NYMEX CRUDE NOV3 100.99 +0.32 100.52 101.04 9917
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
Crude in U.S. dollars per barrel
($1=3.16 Malaysian ringgit)
(Editing by Richard Pullin and Prateek Chatterjee)