JAKARTA: Malaysian palm oil futures extended declines to a fifth straight session on Thursday, the longest losing streak since mid-September, tracking weakness in rival edible oils and crude oil, but a weaker ringgit limited losses.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange lost 20 ringgit, or 0.54%, to close at 3,699 ringgit ($791.74) per metric ton.
The contract hit its lowest level in more than six weeks at 3,641 ringgit per metric ton earlier in the day, before paring some losses.
“External market was recovering from earlier losses and the market is oversold, hence some corrective bounce occurred,” a Kuala Lumpur-based trader told Reuters, adding that weakness in the Malaysian ringgit lent some support.
Dalian’s most-active soyoil contract fell 0.9%, while its palm oil contract shed 1.06%. Soyoil prices on the Chicago Board of Trade rose 1.42%.
Palm oil falls to four-week low on weak rival oils
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Malaysian ringgit, the contract’s currency of trade, weakened 0.13% against the U.S. dollar, making palm oil more attractive for foreign currency holders.
Indonesia will continue 35% biodiesel mandatory blending in 2024 and has allocated 13.41 million kilolitres of biodiesel for next year, slightly higher than the 13.15 million kilolitres allotted for 2023.
Palm oil in the European vegetable oils market fell for a third consecutive day on Wednesday, following lower Malaysian palm oil futures. Asking prices for palm oil were between unchanged and $17.50 a tonne lower.
Palm oil may fall into a range of 3,630-3,640 ringgit per metric ton, as suggested by a retracement and a projection analysis, Reuters technical analyst Wang Tao said.
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