Malaysian palm oil futures dropped on Monday as caution over rising stockpiles outweighed positive September export numbers. The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange was down 0.8 percent at 2,157 ringgit ($521.27) a tonne. Trading volumes stood at 66,234 lots of 25 tonnes each.
"The market is down on rising palm oil stockpiles, but the weaker ringgit and crude oil prices provide some underlying support," one Kuala Lumpur-based trader said. A weaker ringgit makes palm oil more attractive to traders holding foreign currencies. The currency was trading 0.1 percent down in earlier Monday trade but strengthened in the evening.
Malaysian inventories last rose to a seven-month high of 2.49 million tonnes in August, according to official data from a Malaysian industry regulator.
Last week industry analyst Dorab Mistry pegged Malaysia's peak end-stocks at 3-3.3 million tonnes for the year and estimated Indonesia's inventories at close to 5 million tonnes and rising.
Another trader said the September export numbers failed to cheer the market.
Exports of Malaysian palm oil products for September were up 51.6 percent from August, cargo surveyor Intertek Testing Services said on Friday, while data from independent inspection company AmSpec Agri Malaysia showed the exports rose by 49.2 percent.
In related oils, the Chicago September soyabean oil contract was down 0.2 percent.
The Dalian January soyabean oil contract and January palm oil contract were untraded because the Dalian Commodity Exchange was closed for national holidays in China. Palm oil prices are affected by movements of other edible oils that compete in the global vegetable oils market.
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