Palm oil falls for third session on weak export demand, strong ringgit

JAKARTA: Malaysian palm oil futures inched lower for a third consecutive session on Tuesday, weighed down by a strong ringgit and cargo surveyor data showing weak exports.

The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange declined 29 ringgit, or 0.71%, to 4,054 ringgit ($1,042.16)a metric ton by the midday break.

“The market is looking for fresh direction, not much news to move the market,” said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari, adding that the strong ringgit and weak export data pressured prices.

Exports of Malaysian palm oil products for February 1-20 were estimated to have fallen between 8.9% and 12.6% from a month earlier, according to data from cargo surveyors Intertek Testing Services and AmSpec Agri Malaysia.

READ MORE: Palm falls for a second session on weaker crude oil, stronger ringgit

The ringgit, palm’s currency of trade, eased 0.05% against the dollar but still hovered around its strongest level since April 2018.

The Malaysian Palm Oil Council said on Tuesday that crude palm oil prices are expected to range between 4,000 ringgit and 4,300 ringgit ($1,026-$1,103) per metric ton in March as tightening supply, improving demand from top buyer India, and firm U.S. soybean oil prices will support palm oil prices.

Dalian’s most-active soyoil contract rose 0.97%, while its palm oil contract gained 0.85%. Soyoil prices on the Chicago Board of Trade was unchanged.

Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.

Palm oil may revisit its February 20 high of 4,156 ringgit per ton.