KUALA LUMPUR: Malaysian palm oil futures extended losses to a third consecutive session on Monday, weighed down by a decline in rival oils although anticipation of lower output and improving demand underpinned the contract.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange lost 38 ringgit, or 0.98%, at 3,852 ringgit ($823.43) a metric ton by midday, its lowest level in nearly two weeks.
Easing production, higher exports and lower end-month stocks could see the February contract re-testing the 4,000 ringgit ($855.07) mark, said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Exports of Malaysian palm oil products during Nov. 1-25 were estimated to be up between 7% and 14% from the previous month, data from surveyors Intertek Testing Services and AmSpec Agri Malaysia showed on Saturday.
Palm books weekly loss on weaker Dalian vegetable oils
In related oils, Dalian’s most active soyoil contract fell 0.39%, while its palm oil contract ticked down 0.5%.
Soyoil prices on the Chicago Board of Trade were up 1.03%. Palm oil prices are affected by the soyoil prices as they compete for a share in the global vegetable oil market.
The ringgit rose 0.6% against the dollar, making the commodity more expensive for buyers holding foreign currency. Oil prices slipped, with Brent falling toward $80 a barrel, as investors awaited the OPEC+ meeting later this week for an agreement to curb supplies into 2024.
O/R Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Palm oil may fall into a range of 3,840 ringgit to 3,860 ringgit per ton, as suggested by a double top, Reuters technical analyst Wang Tao said.
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