KUALA LUMPUR: Malaysian palm oil futures fell on Friday to their lowest since October, on course for a second week of losses as they tracked weaker rivals and faced a lack of fresh orders from importers.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange slid 51 ringgit, or 1.31%, to 3,844 ringgit ($823.13) during early trade, its lowest daily level since Nov. 24.
The contract has declined 1.44% so far this week. It recorded a 5.87% rise for November, reversing a two-month decline.
Fundamentals
Exports of Malaysian palm oil products in November were estimated to be up between 2% and 11% from the previous month, data from surveyors Intertek Testing Services and AmSpec Agri Malaysia showed on Thursday.
Analysts say a lack of fresh buying from key destinations due to higher stocks and weakness in demand is weighing on prices.
Dalian’s most-active soyoil contract fell 1.51%, while its palm oil contract was down 1.7%. Soyoil prices on the Chicago Board of Trade were down 0.88%, extending a two-day decline.
Palm oil firms on better-than-expected exports
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Oil prices fell in early Asian trade on Friday, extending losses after OPEC+ producers agreed to voluntary oil output cuts for the first quarter next year that fell short of market expectations. O/R
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The Malaysian ringgit, palm’s currency of trade, weakened 0.28% against the dollar. A weaker ringgit makes palm oil more attractive for foreign currency holders.
Palm oil may extend its bounce into a range of 3,935-3,953 ringgit per metric ton, driven by a wave c, Reuters technical analyst Wang Tao said.
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