KUALA LUMPUR: Malaysian palm oil futures extended early losses on Thursday to close 1.4% lower on worsening November exports, but supply concerns helped limit further slide. The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange fell 46 ringgit to 3,239 ringgit a tonne.
Exports from Malaysia during Nov. 1 to 25 fell 19% compared with the same period in October, cargo surveyors said on Wednesday. Shipments to the biggest market, the Indian subcontinent, fell by nearly 50%, and demand from the European Union declined marginally, according to data from Intertek Testing Services.
"However, looming lower production added with the monsoon rains kept prices defensive today," said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari.
The contract had risen 1% in the previous session on tight supply outlook as the La Nina weather pattern hits global production of vegetable oils, including palm.
"Until more is known about December demand and the damages to supply, prices will remain in a tight trading range," Paramalingam said.
Dalian's most-active soyaoil contract rose 0.5%, while its palm oil contract fell 0.6%. The Chicago Board of Trade was closed for a Thanksgiving holiday. Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market. Crude oil prices slipped 1%, making palm a less attractive option for biodiesel feedstock.
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