KUALA LUMPUR: Malaysian palm oil futures slipped to the lowest close in more than one-week on Tuesday, as the market reopened after the Eid holidays, weighed down by poor exports in April so far.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange slid 67 ringgit, or 1.81%, to 3,638 ringgit ($818.82) a tonne by the midday break, down for a third-straight session.
It fell as much as 3.86% during early trade.
Palm slides for second day as exports fall, but gains for week
“The broader weakness in soft oils has forced palm oil to trade lower as the palm oil is still seen at premium over competing soft oils,” said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.
Bagani said the market is also expecting top producer Indonesia to revert its domestic market obligation policy - which requires a percentage of its palm oil to be sold domestically - back to pre-Ramadan quotas.
Indonesia palm oil export levies and export duties for the May 1-15 period are also expected to decline, he added.
Shipments during April 1-25 fell 18.4% from a month earlier, independent inspection firm AmSpec Agri Malaysia reported, while cargo surveyor Intertek Testing Services reported a 14% decline.
Malaysia’s exports of palm oil and palm-based products to China are expected to increase this year following better cooperation between the two countries, the Malaysian Palm Oil Board said on Tuesday.
Dalian’s most-active soyoil contract fell 0.13%, while its palm oil contract eased 0.25%. Soyoil prices on the Chicago Board of Trade were down 0.08%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
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