JAKARTA: Malaysian palm oil futures snapped a three-session rally on Wednesday, weighed down by cargo surveyor data showing weak export demand and a stronger ringgit.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange lost 46 ringgit, or 1.08%, to 4,214 ringgit ($948.46) a metric ton by the midday break.
“Crude palm oil futures are range trading between 4,180 and 4,280 ringgit while waiting for new leads on the back of weak exports and slower production,” a Kuala Lumpur-based trader said.
Exports of Malaysian palm oil products for Jan. 1-20 were estimated to have fallen between 18.2% and 23%, according to cargo surveyors Intertek Testing Services and independent inspection company AmSpec Agri Malaysia.
The Malaysian ringgit, palm’s currency of trade, strengthened 0.74% against the US dollar. A stronger ringgit makes palm oil less attractive for foreign currency holders.
Dalian’s most-active soyoil contract was up 0.16%, while its palm oil contract slipped 0.47%. Soyoil on the Chicago Board of Trade was up 0.09%.
Palm oil tracks price movements in rival edible oils as it competes for a share of the global vegetable oils market.
Palm oil rises for third straight session, tracks rival oils higher
Malaysian CPO futures are expected to average higher in 2025 than last year, as top producer Indonesia boosts palm oil-based biodiesel consumption, although competition from cheaper rivals is expected to limit the upside, a Reuters poll showed.
Indonesia’s palm oil fund agency has resumed fund disbursement to subsidise biodiesel and oil palm tree replanting programmes after a brief pause during a reorganisation, agency official Achmad Maulizal said on Wednesday.
Palm oil may revisit the Jan. 16 low of 4,106 ringgit per ton, as a bounce triggered by this barrier seems to have completed around 4,265 ringgit, Reuters technical analyst Wang Tao said.
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