Malaysian palm oil futures fell on Thursday as the ringgit rose amid sliding US Treasury yields, dragging down sentiment for the vegetable oil. The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange was down 1.2% at 2,021 ringgit ($487.46) per tonne at the close. It was the largest intraday fall in over a week. A Kuala Lumpur-based futures trader said palm's fall was mainly driven by the strong performance of the ringgit, which strengthened for a second straight session, rising 0.6% against the dollar in its sharpest intraday gain since March 2.
A stronger ringgit makes palm oil less attractive to holders of other currencies. Soyaoil futures which traded lower earlier in the session added pressure on palm. The Chicago Board of Trade July soyabean oil contract last rose less than 0.1%. The September soyaoil contract on the Dalian Commodity Exchange fell 0.5%, while the Dalian September palm oil contract was down 0.3%.
Palm oil prices are affected by movements in related edible oils, with which it competes for global market share. Cargo surveyor Intertek Testing Services and independent inspection company AmSpec Agri Malaysia said on Thursday exports of Malaysian palm oil products for June 1-20 fell 12.7% and 5.8%, respectively from a month earlier. Expectations for the full-month exports were upbeat. "The market is generally looking at unchanged to positive exports for June," the trader said.
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