KUALA LUMPUR: Malaysian palm oil futures reversed early gains on Tuesday, falling to a more than two-week trough as a stronger ringgit and weaker rival edible oils outweighed a surge in exports.
The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange fell 82 ringgit, or 1.99%, to 4,030 ringgit ($889.62) a tonne, its lowest closing since Oct. 28.
The ringgit, palm’s currency of trade, rose for a third day against the dollar, making the commodity more expensive for holders of other currencies.
Exports from the world’s second largest producer Malaysia in November 1-15 period rose between 10% and 12.7%, compared to the same weeks in October, cargo surveyors data showed.
Disruptions to palm oil supplies because of tropical storms in top producers Indonesia and Malaysia are expected to continue into the first quarter of 2023, keeping prices strong, the Malaysian Palm Oil Board (MPOB) said on Monday.
MPOB warned of a tough 2023 for the market, with the persistence of global uncertainties in weather, geopolitics and economics that have caused wide price swings this year.
India’s palm oil imports in 2021/22 fell 4.8% from a year earlier as overseas buying of soyoil jumped 45.3% to a record high after Indonesia restricted shipments of palm oil, a trade body said on Monday.
Dalian’s most-active soyoil contract fell 1.1%, while its palm oil contract was down 2.7%. Soyoil prices on the Chicago Board of Trade slipped 0.4%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.