Malaysian palm oil futures recovered from early losses to close only slightly lower on Thursday, helped by improving trends in the broader vegetable oil market. The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was down 0.3% at 1,983 ringgit ($482.13) per tonne at the close of trade. It is up 2% so far this week. Earlier in the session, the contract fell as much as 0.8%, tracking weakness in overnight soyaoil on the Chicago Board of Trade (CBOT).
US soyaoil futures on the CBOT dropped 1.1% on Wednesday, but were up 0.5% as of 1050 GMT. "Palm opened lower on spillover weakness from the sharp drop in rival oilseed overnight," said a Kuala Lumpur-based futures trader. US soyabean futures had hit a nine-day low on Thursday as forecasts for cooler weather across a major growing region calmed fears that hot, dry conditions could hurt yields.
Palm oil may break resistance at 1,984 ringgit per tonne and rise to the next resistance at 2,001 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals. Meanwhile, the September soyaoil contract on the Dalian exchange eased 0.04%, and the Dalian September palm oil contract also dipped 0.1%. Palm oil prices are affected by movements in related oils that compete for a share of the global vegetable oils market.
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