JAKARTA: Malaysian palm oil futures fell for two consecutive weeks on Friday to the lowest in six weeks, tracking weakness in soyoils, although strong export data limited losses.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange slid 0.31% to 3,921 ringgit ($874.64) a tonne.
The contract dropped for three straight sessions on Friday and lost 4.2% for the week amid fears that the closure of several U.S banks and trouble at Swiss lender Credit Suisse would blow up into a global banking crisis.
“We are tracking external movement, namely the softening of Dalian as well as the Chicago soyoil movement. Right now, the market is jittery awaiting the Federal Open Market Committee’s decisions on interest rates next week,” a Kuala Lumpur-based trader said.
However, strong export data and probable low production due to recent flooding supported the contract, the trader added.
Palm oil snaps 3-day losing streak as demand surges
Exports of Malaysian palm oil products for March 1-15 rose between 55% and 72% from the same period in February, as shipments to India jumped ahead of the Muslim festival of Eid, according to cargo surveyors data.
Top producer Indonesia said it will enforce domestic market obligation to ensure palm oil producers sell 450,000 tonnes of cheap cooking oil at home in March to secure supply ahead of Islamic festivities, after missing the target in February, the country’s trade minister said earlier this week.
Dalian’s most active soyoil contract slid 0.70%, while its palm oil contract rose 0.75%. Soyoil prices on the Chicago Board of Trade were down 0.61%.
Palm oil may retest a support of 3,892 ringgit per tonne, a break below which could trigger a fall into a range of 3,810-3,856 ringgit, Reuters technical analyst Wang Tao said.
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