KUALA LUMPUR: Malaysian palm oil futures fell on Thursday in a second straight session of losses as forecasts of rising output and declining export demand weighed on the market, said traders.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange shed 0.45 percent to 2,444 ringgit ($573.24) a tonne at the close. Traded volumes stood at 46,998 lots of 25 tonnes each.
Palm oil futures posted their sharpest daily loss in two weeks in the previous session. In the first half of trading on Thursday, palm rose 0.12 percent, as traders squared positions ahead of a long weekend. The Malaysian palm oil market will be closed on Monday for a holiday.
A Kuala Lumpur-based trader said weaker demand, given that Ramadan is almost halfway through, and expectations of rising production weighed on sentiment.
"The market is under pressure on industry talk that June 1-10 exports could be lower," said a another trader.
Palm oil shipments are seen declining after Eid-al-Fitr, which marks the end of Ramadan, on weaker consumption for the tropical oil.
Many Muslims break day-long fasts during Ramadan with communal feasting, for which palm oil is commonly used as cooking oil.
Ramadan demand supported palm oil prices in May with exports seen rising 13.6 percent from a month earlier to 1.46 million tonnes.
Palm oil output in Malaysia, the world's second-largest producer, is seen gaining in the second half of this year as the crop recovers from the damaging effects of the El Nino weather pattern.
Production in May likely rose 5.5 percent to 1.63 million tonnes from the previous month, a Reuters survey of planters, traders and analysts showed.
In other related oils, soybean oil on the Chicago Board of Trade climbed as much as 0.38 percent, while the September soybean oil contract on the Dalian Commodity Exchange fell 0.21 percent.
The September contract for palm olein slid as much as 1.07 percent.
Palm oil prices are generally affected by the performance of related edible oils, as they compete for a share in the global vegetable oils market.
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