Palm extends decline, tracking weak rival oils

KUALA LUMPUR: Malaysian palm oil futures continued to decline on Monday, tracking weak soyoil and in the absence of fresh cues, after three weeks of declines on demand concerns.

The benchmark third-month palm oil contract on the Bursa Malaysia Derivatives Exchange fell 0.4 percent to 2,104 Malaysian ringgit ($516) a tonne.

Traders in Malaysia said the market had factored in earlier demand weakness and has no new catalysts.

"The market lacks supportive news to sustain the initial rebound this morning," said a Kuala Lumpur trader.

Another trader said palm was tracking weakness in overnight bean oil prices.

Chicago soybean oil fell 0.7 percent last week and was down 0.3 percent.

The Dalian Commodity Exchange soyoil and palmolein contracts were both 0.3 percent up after losing more than 3 percent last week.

Palm oil dropped 2.8 percent last week.

Ample supplies with top buyers China and India weighed on market sentiment for palm, though traders have said the downside was limited.

European nations were also reducing palm oil consumption because of environmental concerns.

Palm could rise to 2,142 ringgit a tonne, having cleared resistance at 2,094 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

"The strong recovery of the price from the March 15 low of 2,038 ringgit, along with the five-wave structure of the downtrend from 2,344 ringgit, suggests a reversal of the downtrend," he said.