BEIJING: Malaysian palm oil futures fell for a third session on Thursday to its lowest closing in 10 days, as forecasts of higher output outweighed rising export shipments.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange slid 7 ringgit, or 0.18%, to 3,918 ringgit ($840.77) a metric ton, closing at its lowest since July 15. Exports of Malaysian palm oil products for July 1-25 rose 31%, cargo surveyors Intertek Testing Services and Amspec Agri said on Thursday.
The Malaysian Palm Oil Association has estimated production during July 1-20 rose nearly 15% from a month ago, traders and analysts said. Indonesia, the world’s biggest palm oil producer, is testing fuel with a view to increasing to 40% from 35% the share of palm-oil blended into biodiesel next year, the energy ministry said.
Dalian’s most-active soyoil contract fell 1.1%, while its palm oil contract lost 1.5%. Soyoil prices on the Chicago Board of Trade were down 0.5%.
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 on mixed demand signals a day after large draws on US inventories while consumption in China, the world’s largest crude importer, remains lacklustre.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
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