MUMBAI: Malaysian palm oil futures fell more than 1% in early trade on Friday, tracking weakness in Chicago soyoil prices because of higher supplies, and as India’s palm oil imports declined in March.
Malaysian palm oil opens higher on lower inventories
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange fell 70 ringgit, or 1.64%, to 4,247 ringgit ($891.48) a metric ton in early trade.
Fundamentals
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Soyoil prices on the Chicago Board of Trade fell 0.2% on Friday after losing 3.2% on Thursday.
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India’s palm oil imports in March plunged to their lowest in 10 months as higher prices prompted refiners to substitute palm oil with sunoil, resulting in sunoil imports reaching the second-highest on record.
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Exports of Malaysian palm oil products for April 1-10 rose 12.7% to 431,190 metric tons from 382,640 metric tons shipped during March 1-10, cargo surveyor Intertek Testing Services said on Wednesday.
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The US Department of Agriculture’s monthly supply-and-demand report left its forecast for Brazil’s soybean crop unchanged at 155 million metric tons.
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However, Brazilian crop agency Conab reduced its soybean output projection to 146.522 million metric tons due to adverse weather, highlighting a big divide in the outlooks.
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Argentina’s Buenos Aires grains exchange cut its harvest estimate for the 2023/24 soybean crop on Thursday, citing impacts from dry conditions.
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Malaysia’s palm oil inventories are expected to have declined 6.65% from the prior month to an eight-month low of 1.79 million tons at the end of March, a Reuters survey showed.
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Palm oil may retest support at 4,274 ringgit per metric ton, as the fall from 4,443 ringgit looks incomplete, according to Reuters’ technical analyst Wang Tao.
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