- Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
KUALA LUMPUR: Malaysian palm oil futures fell on Thursday after three straight sessions of gains, as weaknesses in rival vegetable oils and crude oil weighed on the market.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange slid 67 ringgit, or 1.74%, to 3,778 ringgit ($913.88) a tonne by the midday break, retreating from a near two-week high hit on Wednesday.
"Market fell on the back of overnight weakness in soybean oil, and higher production in Malaysia also added to forward months selling activities," a Kuala Lumpur-based trader said.
Nearby spot prices remain firm and will weaken further only if exports slow, he added.
Dalian's most-active soyoil contract fell 2.7%, while its palm oil contract declined 2%. Soyoil prices on the Chicago Board of Trade were down 0.1% after a near 2% drop on Wednesday.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Oil prices fell after official figures showed a big increase in US gasoline stocks, causing concerns about demand for crude weakening in the world's biggest consumer of the resource at a time when supplies around the world are rising.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Palm oil may test a resistance at 3,926 ringgit per tonne, a break above which could lead to a gain to 4,028 ringgit, Reuters technical analyst Wang Tao said.