KUALA LUMPUR: Malaysian palm oil futures ended flat on Monday as weakness in the Chicago soyoil contract and lower export estimates were offset by expectations of a fall in production.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange fell 0.02% to 4,215 ringgit ($963.43) a metric ton at the close. Sharply lower Chicago soyoil futures after U.S President Donald Trump threatened sanctions on Columbia influenced futures prices, said Anilkumar Bagani, commodity research head at Mumbai-based Sunvin group. “Export performance in Malaysia has also been consistently weak as seen during the Jan. 1-25 export period,” he said. Bagani also said Malaysian production likely declined in Jan. 1-20 by up to 14% from a month ago, citing estimates from the Malaysian Palm Oil Association and others.
Dalian’s most-active soyoil contract rose 1.63%, while its palm oil contract added 2.08%. Soyoil prices on the Chicago Board of Trade were down 0.62%. Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market. Indonesia’s November palm oil stocks rose 3.2% from the previous month to 2.58 million tons as slowing exports offset a decline in production, data from Indonesian palm oil association GAPKI showed.
Cargo surveyors estimate exports of Malaysian palm oil products fell between 18.9% and 24.1% during Jan. 1-25, compared with the same period a month ago. Oil prices wavered on Monday after the US and Colombia reached a deal on deportations, reducing immediate concern over oil supply disruptions but keeping traders on edge. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock. The ringgit, palm’s currency of trade, was unchanged against the US dollar.
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