Malaysian crude palm oil futures was down on Monday after a mixed performance in Chicago soya but the benchmark contract closed off its lows on late covering, dealers said.
August, the third-month palm oil futures on the Malaysia Derivatives Exchange (MDEX), settled 14 ringgit, or 0.9 percent, lower at 1,536 ringgit ($404.21) a tonne. The contract hit a bottom of 1,508 in the before pulling back to 1,518 break.
Overall volume on the MDEX stood at 4,181 lots, way below the 10,000 lots averaged on the busiest days of last week.
"There's not much incentive for doing anything," said a trader. Soya and palm compete for the same export markets and their prices often move in step.
Soyaoil futures on the Chicago Board of Trade (CBOT) ended up 0.51 cent to down 0.17 cent per lb on Friday, with the key July contract up 0.51 cent at 28.41 cents.
But Chicago soyabeans were sharply lowers on Monday's Asian trade, with e-CBOT's July bean contract down 21 1/2 cents a bushel at $8.17.
MDEX futures have been dampened in recent weeks by volatility in Chicago soya and worries that physical stocks of palm oil could grow sharply in June as export plummet and production surges.
Leading crop analyst, Ivan Wong, said on Friday he estimated closing stocks of palm oil in May at 1.13 million tonnes against the official tally of 1.0 million tonnes in April.
The market's next trade data is due on June 10, when cargo surveyors release export estimates of palm oil for the first 10 days of the month.
"Until then, this market will have to depend on how soy behaves," said another futures trader in Kuala Lumpur. Cash prices of palm oil were also down on Monday.
The physical contract for June saw buyers/sellers at 1,570/1,575 ringgit a tonne in the southern region at the close, compared with Friday's 1,580/1,585.
In the central region, June was quoted at 1,565/1,570. Trades were reported at 1,550-1,570 in the south and 1,555-1,565 in the central zone.
Physical oil for July was bid/offered at 1,540/1,555 in the south and 1,530/1,550 in the central zone. No trade was reported.
PALM OIL FUTURES:
June (south): 1575.
Open/High/Low: 1530/1544/1508.
Previous closes: 1585.
PALM OIL PHYSICALS:
August (3rd month): 1536.
Previous settlement: 1550.
FUTURES:
Benchmark third-month August down 14 ringgit to 1,536 ringgit ($404.21) a tonne.
PHYSICALS: Also down.
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