KUALA LUMPUR: Malaysian palm oil futures fell nearly 1 percent on Tuesday, undoing most of last week's gains, as rival oils fell and poor export data spooked the market.
Benchmark palm oil futures for March delivery slid 0.92 percent on the Bursa Malaysia Derivatives Exchange to 3,113 ringgit ($695.18) a tonne in the first-half of the session.
Traded volumes stood at 20,042 lots of 25 tonnes each.
"Market is under pressure from the sharp fall on Dalian," a trader in Kuala Lumpur said.
Palm prices are influenced by other vegetable oils as they compete for shares in the global edible oils market.
The May soybean oil contract on the Dalian Commodity Exchange fell 2.2 percent, while the May contract for Dalian palm olein fell 2.9 percent.
Another trader said the market was seeing a correction after last week's rally, while data showing a drop in exports aided the selloff.
Shipment data released on Tuesday by cargo surveyors Intertek Testing Services and Societe Generale de Surveillance showed a 14.4 percent drop in exports for Dec. 1-20, compared with the Nov. 1-20 figures.
"Indeed, there was a strong reaction when data came out, but it's more of a correction given the recent rally in prices," the Kuala Lumpur-based trader said.
The futures had been on an uptrend in recent weeks as a weaker ringgit and lower production had lent support. Last week, palm achieved three consecutive sessions of gains, and hit a four-and-a-half-year high.
A weaker ringgit makes palm oil cheaper for holders of foreign currencies, while palm output is impacted by the lingering effects of a crop-damaging El Nino as well as year-end monsoon rains.
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