Palm oil edges lower after three-day rally
- Palm market had "profit-taking in mind" as the current rally is heading for its sixth consecutive weekly gain, a trader in Kuala Lumpur said
JAKARTA: Malaysian palm oil prices dropped slightly on Wednesday, following a more than 7% gain in the past three sessions, although supply disruption concerns limited losses.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange fell 0.2% to 4,413 ringgit ($1,043.26) a tonne by midday break.
Palm market had "profit-taking in mind" as the current rally is heading for its sixth consecutive weekly gain, a trader in Kuala Lumpur said.
Palm oil posts best week in 5-1/2 years
Fundamentally, Malaysian palm prices "should be strong" due to supply disruption concerns amid rising COVID-19 cases, however, Malaysia also faces competition from rival Indonesia, the trader said.
"Indian demand doesn't reflect in our export, as a matter of fact, India is buying from Indonesia due to the discount," the trader said.
Indonesia has set the crude palm oil reference price lower in August, at $1,048.62 per tonne, lowering export taxes to $93 per tonne, while export levies for crude palm oil remain unchanged at $175 per tonne.
In related oils, Dalian's most-active soyoil contract slipped 0.02% and its palm oil contract was up 0.07% in early trade.
Meanwhile, soyoil prices on the Chicago Board of Trade rose 0.06%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil may revisit its May 12 high of 4,525 ringgit per tonne, as it is about to break a resistance at 4,450 ringgit, said Reuters technicals analyst Wang Tao.
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