Malaysian palm oil futures snapped a four-day winning streak on Friday as traders booked profits ahead of official data on supply and demand, but still ended the week with its best performance in more than three years. The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange settled down 1.3%, at 2,813 ringgit ($680.13).
The contract has rallied 8% this week, the most since November 2016, on expectations that January inventories will likely falling to below 2 million tonnes, according to a Reuters survey. "CPO (crude palm oil) futures were trading lower in the morning session, partly to regain the discount to soyabean oil after narrowing in the last four days," said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Traders now await the Malaysian Palm Oil Board's (MPOB) January data on Monday to assess the supply-demand situation in the world's second-largest producer. "While January exports (data) is certain to be bleak, February export demand is also bracing for a downturn," Varqa said.
The contract rebounded from last week's sharp fall of 9% as concerns over the fast-spreading coronavirus disrupting demand from top buyer China eased. The Dalian Commodity Exchange's most-active soyaoil contract rose 1.6%, while the palm oil contract also gained 0.85%. Soyaoil prices on the Chicago Board of Trade fell 0.8%.
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