KUALA LUMPUR: Malaysian palm oil futures closed lower on Friday, as soyoil weakness offset firmer exports, though the contract still logged its second monthly gain.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange slid 41 ringgit, or 0.88percent, to 4,642 ringgit (USD1,136.91) a metric ton at the close.
The contract declined 1.69percent this week, ending a three-week rally, yet it still posted a 2.11percent monthly gain. Crude palm oil futures traded lower, reflecting weakness in the soyoil market during Asian hours, but losses were capped by recent strength in exports, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.
Cargo surveyors estimated that exports of Malaysian palm oil products for July rose between 12.1percent and 19.5percent from a month earlier.
Dalian’s most-active soyoil contract fell 0.06percent, while its palm oil contract shed 0.84percent. Soyoil prices on the Chicago Board of Trade were down 1.17percent.
Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market. Oil prices fell more than 1percent as more supplies flowed through crucial maritime chokepoints, despite a lack of major breakthroughs in talks between the United States and Iran.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock. The ringgit, palm’s currency of trade, weakened 0.2percent against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.
Indonesia has lowered its crude palm oil reference price to USD996.52 a ton for August from USD1,000.90 in July, a trade ministry regulation showed.
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