JAKARTA: Malaysian palm oil futures extended losses into a third session on Wednesday, dragged down by lacklustre performances in Dalian vegetable oils and expectations of improved output.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange lost 36 ringgit, or 0.89%, to 4,007 ringgit ($912.98) a metric ton at closing, its lowest closing price since October 1.
“Palm futures are tracking spill over weakness from the external markets,” a Kuala Lumpur-based trader said, adding that expectation of a seasonal output growth also pressured the price.
Meanwhile, strong export data for the April 1-15 period lent support to the contract, the trader said. Exports of Malaysian palm oil products for April 1-15 are estimated to rise between 13.6% and 17% from a month ago, said cargo surveyor Intertek Testing Services and independent inspection company AmSpec Agri Malaysia. Dalian’s most active soyoil contract was down 0.23%, while its palm oil contract plunged 1.08%. Soyoil prices on the Chicago Board of Trade (CBOT) were up 0.38%.
Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market. Malaysia has maintained its May export tax for crude palm oil at 10% and lowered its reference price, a circular on the Malaysian Palm Oil Board website showed on Tuesday.
Palm oil may bounce into a range of 4,119-4,176 ringgit per ton, as it has stabilized around support at 4,026 ringgit, Reuters technical analyst Wang Tao said.
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