JAKARTA: Malaysian palm oil futures fell on Monday, following the decline in rival vegetable oil prices on the Dalian and Chicago exchanges, which pressured the market.
Palm oil falls as weather improves in Malaysia
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange lost 6 ringgit, or 0.12%, to 5,122 ringgit ($1,158.04) a metric ton during the morning trade.
Fundamentals
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Dalian’s most-active soyoil contract dropped 0.74%, while its palm oil contract slipped 0.14%. Soyoil fell 0.54% at the Chicago Board of Trade.
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Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.
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A flood struck Malaysia last week after heavy rains in late November, and the country’s meteorological department forecast a monsoon surge from Dec. 8 to 14, which could bring continuous rainfall to the east coast of Peninsular Malaysia and parts of Sabah and Sarawak on Borneo Island.
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Malaysia’s palm oil inventories are likely to have dropped in November for a second consecutive month as torrential rains disrupted production, a Reuters survey showed.
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Palm oil may break resistance at 5,162 ringgit per metric ton, and rise towards the 5,202 ringit to 5,242 ringgit range, driven by a wave 5, Reuters technical analyst Wang Tao said.
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