JAKARTA: Malaysian palm oil futures fell on Monday after three straight sessions of gains, due to weakness in rival oils and a quieter market.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was down 1.15% to 3,518 ringgit ($793.24) a tonne on the midday break.
The contract rose 2.24% last week as the El Nino weather phenomenon raised output concerns.
“The Bursa Malaysia Derivatives opened gap lower mirroring weakness in rival oilseeds. Market quiet with low trading volume as US closed for Memorial Day Holiday,” a Kuala Lumpur-based trader told Reuters, adding that some technical buying emerged at late hour but failed to sustain.
Crude palm oil production in Malaysia, the world’s second-largest producer, could drop between 1 and 3 million tonnes next year as a result of the El Nino weather pattern, the Malaysian Palm Oil Board said on Friday.
Palm oil may retrace to 3,498 ringgit
Malaysia’s exports during May 1-25 fell 0.7% from the same period in April, cargo surveyor Intertek Testing Services said on Friday. Another cargo surveyor, AmSpec Agri Malaysia, said exports rose 0.7%.
Dalian’s most-active soyoil contract rose 0.17%, while its palm oil contract fell 0.94%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil may retrace to 3,498 ringgit per tonne, as it failed to break resistance at 3,563 ringgit.
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