KUALA LUMPUR: Malaysian palm oil futures were on track for a third straight session of declines on Friday, hitting their lowest in more than a week, as weaker performing rival oils and a stronger ringgit weigh on prices.
Benchmark palm oil futures for March delivery on the Bursa Malaysia Derivatives Exchange were down 0.8 percent at 3,071 ringgit ($687) a tonne at the midday break. Earlier in the session, they hit 3,069 ringgit, their weakest since Dec. 27.
Traded volumes stood at 23,153 lots of 25 tonnes each at noon.
"The ringgit factor is what's driving the market today," said a futures trader from Kuala Lumpur, while another trader added that weaker performing related oils dragged palm's prices.
The ringgit, palm's currency of trade, rose 0.2 percent against the dollar to reach 4.4730 around noon. It earlier fell to 4.4700, its strongest levels in three weeks.
The ringgit had witnessed a slide in the past two months on a stronger dollar, making palm oil cheaper for holders of foreign currencies.
Palm's movements also track the prices of related edible oils, as they compete for a share in the global vegetable oils market.
The March soybean oil contract on the CBOT gained 0.03 percent, while the May soybean oil contract on the Dalian Commodity Exchange dropped 0.4 percent.
In other edible oils, the May contract for Dalian palm olein fell 0.6 percent.
Slowing palm oil shipments in recent weeks have also weighed on market sentiment. December exports of the tropical oil are seen declining for a third straight month by 3 percent, while output is forecast to drop 8 percent to 1.45 million tonnes, showed a Reuters survey.
End-stocks are expected to fall for the first time in four months by 3.8 percent to 1.32 million tonnes <MYPOMS-TPO>. Official government palm oil data is scheduled to be out on Jan. 10.
Palm oil is expected to fall to 3,014 ringgit per tonne, as it has cleared a support at 3,089 ringgit, said Reuters market analyst for commodities and energy technicals Wang Tao.
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