JAKARTA: Malaysian palm oil futures extended losses on Tuesday due to profit-taking, snapping a two-session winning streak, while the market awaited export data for further direction.
The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange lost 52 ringgit, or 1.23%, to 4,178 ringgit ($982.60) a metric ton by the midday break.
“Today’s market is (focusing on) profit taking after its recent rise on the back of softer Dalian palm oil,” a Kuala Lumpur-based trader said.
Dalian’s most active soyoil contract was flat, while its palm oil contract slightly gained 0.02%. Soyoil prices on the Chicago Board of Trade were down by 0.43%.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Oil prices fell on Tuesday after U.S. President Donald Trump’s lengthy 50-day deadline for Russia to end the Ukraine war and avoid sanctions eased immediate supply concerns.
Palm oil gains tracking rival oils, higher crude prices
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, slightly weakened 0.05% against the dollar, making the commodity cheaper for buyers holding foreign currencies.
India’s palm oil imports jumped to an 11-month high in June as refiners ramped up purchases due to a price discount compared to rival soyoil and sunflower oil, and to replenish depleted inventories.
Palm oil may test resistance at 4,257 ringgit per metric ton, a break above which could lead to a gain to 4,295 ringgit, Reuters technical analyst Wang Tao said.
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