Malaysian palm oil futures hit their lowest in more than three years on Thursday, edging down at the end of the trading day for a third straight session of losses, tracking weakness in related edible oils. The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange closed 0.3 percent lower at 2,144 ringgit ($513.29) a tonne.
It earlier fell as much as 0.8 percent to 2,133 ringgit, its lowest level since Sept. 2015. Trading volumes stood at 43,143 lots of 25 tonnes each. "The market is down, tracking weak external markets but the ringgit remains weak, hence capping some losses," said a Kuala Lumpur-based trader, referring to soyaoil on the US Chicago Board of Trade and China's Dalian Commodity Exchange.
The ringgit, palm's trading currency, is currently trading at one-year lows of 4.1770 per dollar. A weaker ringgit usually makes palm oil cheaper for holders of foreign currencies. In related oils, the Chicago December soyabean oil contract was down 0.1 percent as a trade war curbs US shipments of the oilseed to China, the world's biggest buyer.
Meanwhile, the January soyabean oil contract on the Dalian Commodity Exchange fell 0.2 percent, and the January palm oil contract dropped 0.4 percent. Palm oil prices are affected by movements of other edible oils as they compete for a share of the global vegetable oil market. Palm oil may test support at 2,138 ringgit per tonne, with a good chance of breaking below this level and falling more to the next support zone of 2,099-2,122 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
Comments
Comments are closed.