KUALA LUMPUR: Malaysian palm oil futures fell 1% on Monday, retreating from an 8-1/2-year high hit earlier in the session, on profit-taking and weaker CBOT soybean oil, although forecasts for lower November production limited losses.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange ended down 42 ringgit, or 1.22%, at 3,395 ringgit ($834.15) a tonne. Earlier in the session, it rose as much as 0.96% to its highest since May 2, 2012.
The market traded sideways as other edible oils were lower, but nearby tightness still supports crude palm oil prices, a Kuala Lumpur-based trader said. Malaysia's palm oil inventories in November likely dropped 2% from the previous month to hit a near 3-1/2-year low, as production hit an eight-month low and exports shrank, a Reuters survey showed on Friday.
Data on November supply and demand from the Malaysian Palm Oil Board (MPOB) is due on Thursday.
"Prices may stay firm ahead of MPOB," the trader said, adding that market participants were also watching out for demand factors.
Dalian's most-active soyaoil contract as well as its palm oil contract rose 1%. Soyaoil contract on the Chicago Board of Trade was down 1%.
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