SINGAPORE: Malaysian palm oil futures fell to their lowest in over a week on Thursday, tracking weakness in rival oils which offset support from improving exports.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange declined 0.9%, or 33 ringgit to 3,687 ringgit ($787.15) per metric ton by the midday break, its lowest level since Sept. 13.
Dalian’s soyoil contract fell 2.7%, while its palm oil contract was down 1.2%.
Soyoil prices on the Chicago Board of Trade (CBOT) extended losses after a 1.8% slump overnight as US harvest gathered pace.
Sharp drop in soyoil on CBOT, and lower trading of Dalian soybean oil and palm olein fuelled bearish sentiment of palm despite improving Malaysian exports, said Dr Sathia Varqa, senior analyst with Fastmarkets Palm Oil Analytics.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Exports of Malaysian palm oil products for Sept. 1-20 rose 2.4% from Aug. 1-20, cargo surveyor Intertek Testing Services said on Wednesday.
Another cargo surveyor, AmSpec Agri Malaysia, said exports during the same period rose 1.8%.
“Losses in Asian equities market was also weighing on commodities including palm,” Varqa said.
Asian stocks followed Wall Street’s lead, dipping across the board as investors interpreted the US Federal Reserve’s latest policy statements as signalling higher-for-longer interest rates.
Palm oil may revisit its Sept. 12 low of 3,667 ringgit per ton, as a bounce triggered by the support at 3,695 ringgit has been almost reversed, said Reuters technical analyst Wang Tao.
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