JAKARTA: Malaysian palm oil futures extended losses to a fourth straight session on Thursday, tracking rival oils contracts at the Dalian market and a stronger ringgit.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange was down 28 ringgit, or 0.72%, at 3,858 ringgit ($890.58) a metric ton, as of 0231 GMT.
Fundamentals
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Dalian’s most-active soyoil contract fell 0.8%, while its palm oil contract was down 0.81%. The Chicago Board of Trade gained 0.1%.
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Palm oil tracks price movements in related oils as they compete for a share in the global vegetable oils market.
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The Malaysian ringgit, palm’s currency of trade, gained 0.48% against the dollar. A stronger ringgit makes palm oil less attractive for foreign currency holders.
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Malaysia’s palm oil inventories are expected to have climbed to their highest levels in six months at the end of August due to lacklustre export demand, a Reuters survey showed.
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Indonesia, the world’s biggest palm oil exporter, plans to lower export levy rates of the tropical oil to improve competitiveness against rival vegetable oils and raise farmers’ income.
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Malaysia’s August palm oil exports are seen at 1,376,412 metric tons, according to Amspec Agri.
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Exports of Malaysian palm oil products for August fell 9.9% to 1,445,442 tons from 1,604,578 tons shipped during July, cargo surveyor Intertek Testing Services said.
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Oil was attempting to hold its line in early trade on Thursday after an overnight sell-off, as players grappled with weak demand alongside a possible delay to more supply entering the market next month.
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Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
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Palm oil may break support at 3,864 ringgit per metric ton, and fall into the 3,777 ringgit to 3,821 ringgit range, according to Reuters’ technical analyst Wang Tao.
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