KUALA LUMPUR: Malaysian palm oil futures fell more than 3% on Friday and were set for a weekly drop, weighed down by sharp losses in rival oils and expectations of higher end-October inventories.
The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange slid 163 ringgit, or 3.2%, to 4,910 ringgit ($1,180.57) a tonne in early trade.
Palm was set for a 2.3% weekly decline, the third in four weeks.
Malaysia's palm oil stocks likely rose by 3.5% month-on-month to 1.81 million tonnes at end-October due to lower export volumes, Ivy Ng, regional head of plantations research at CGS-CIMB Research, said in a note.
A survey by CGS-CIMB Futures showed October output probably fell 1.2% from the month before, while export volume likely dropped 13%, Ng said.
The Malaysian Palm Oil Board is scheduled to release October supply and demand data on Nov. 10. Dalian's most-active soyaoil contract fell 2.7%, while its palm oil contract slipped 2.9%. Soyaoil prices on the Chicago Board of Trade were down 0.03%, after declining 2% in the previous session.
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 rise towards 5,187 ringgit, as it has broken a key resistance at 5,048 ringgit per tonne, Reuters technical analyst Wang Tao said.
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