KUALA LUMPUR: Malaysian palm oil futures snapped two straight sessions of gains on Thursday, as weak rival edible oils weighed on prices, while concerns over rising production and sluggish export demand added further pressure.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange slid 48 ringgit, or 1.12%, to 4,230 ringgit ($992.96) a metric ton at the close.
Crude palm oil futures traded lower, tracking weakness in the Chicago soybean oil and Dalian palm olein market during Asian hours, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.
“The persistent concern over rising output and weak export also added pressure on the market,” he said.
Cargo surveyors estimated that July palm oil exports fell between 6.7% and 9.6%.
Dalian’s most-active soyoil contract fell 0.63%, while its palm oil contract lost 0.8%. Soyoil prices on the Chicago Board of Trade were down 0.98%.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Palm oil edges up on higher rival Dalian oils, weak ringgit
Oil prices edged down as investors weigh the supply risks from U.S. President Donald Trump’s push for a swift resolution to the war in Ukraine through more tariffs, while a surprise build in U.S. crude stocks weighed on prices.
At 1023 GMT, the benchmark Brent crude was down 0.59% at $78.81 per barrel. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, weakened 0.59% against the dollar, making the commodity cheaper for buyers holding foreign currencies.
Malaysian palm oil exports to the United States during January-May rose 51.8% from a year earlier to 93,000 metric tons, the Plantation and Commodities Ministry said.
Comments
Comments are closed for this article.