KUALA LUMPUR: Malaysian palm oil futures slumped on Friday to record its biggest monthly decline since September, as traders factored in weak exports and larger supply from top producer Indonesia.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange closed down 102 ringgit, or 2.95%, to 3,353 ringgit ($752.13) a tonne, its lowest closing since Sept. 29.
For the month, palm logged a 10.8% fall, its sharpest since September.
The crude palm oil market is hitting a low on uncertain Indonesian policies and slack demand, said Sandeep Singh, director at The Farm Trade, a Kuala Lumpur-based consulting and trading firm.
Bearish soy and soft oils prices, which are at par or even lower than palm oil at destination markets, also weighed on prices, he added.
Palm oil hits one-month closing low on weak exports
Indonesia will lower its mandatory domestic sales threshold for palm oil producers to 300,000 tonnes a month starting in May, the Trade Ministry said on Thursday, allowing more shipments of the widely used oil to leave the country.
In Malaysia, exports during April 1-20 fell 20.3% from the month before, according to cargo surveyor Societe Generale de Surveillance.
Dalian’s most-active soyoil contract fell 1.2%, while its palm oil contract lost 1.6%. Soyoil prices on the Chicago Board of Trade were up 0.02%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Comments
Comments are closed.