KUALA LUMPUR: Malaysian palm oil futures fell over 1% for a third straight session on Tuesday, slipping to a one-week low on expectations that inventories would rise due to a drop in exports and rising output. The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange closed down 44 ringgit, or 1.19%, to 3,640 ringgit ($897.21) a tonne, hitting its lowest since Feb. 24.
“The combination of higher production and lower export in Malaysia brought sellers and long liquidation,” a Kuala Lumpur-based trader said.
Exports of Malaysian palm oil products for February fell 4.6% to 1,052,779 tonnes from January as China and the United States cut down purchases, cargo surveyor Societe Generale de Surveillance said. European Union palm oil imports in the 2020/21 season stood at 3.69 million tonnes, compared with 3.78 million a year earlier, data published by the European Commission showed.
Palm may continue to weaken as February-end inventories are likely to rise sharply, the trader said. The Malaysian Palm Oil Board is slated to release data on February-end stockpiles on March 10.
Meanwhile, Dalian’s most-active soyaoil contract fell 0.8%, while its palm oil contract slipped 3.4%. Soyaoil prices on the Chicago Board of Trade were down 0.2%. Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
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