Malaysian palm oil futures closed 2.2 percent lower on Monday to hit a near three-week low on weaker crude oil and soyoil markets. Palm oil prices have been treading down on concerns of the incoming bumper soybean crop from South America and some profit-taking in the palm oil market as some traders felt prices have run up too fast and too high.
Benchmark May crude palm oil futures on the Bursa Malaysia Derivatives Exchange dropped 59 ringgit to end at 2,590 Malaysian ringgit ($783.7), a level unseen since February 25. Traded volume more than doubled to 22,165 lots of 25 tonnes each. "It could be technical selling and people just follow it, especially those speculators. There is a chances the market could dip further," one trader in Kuala Lumpur said.
Cargo surveyors Intertek Testing Services and Societe Generale de Surveillance on Monday said Malaysia's palm oil exports rose at least 5.1 percent during March 1 to 15. Another trader said the market was taking profits after cargo surveyor reports met expectations of a rise in demand for the March 1-15 period.
Pressured by stronger dollar and worries about global demand, crude oil fell below $81 a barrel in Asian hours. The May soyoil contract at the Chicago Board of Trade slipped in Asian hours after China cancelled orders for US soybeans. Traders are awaiting a weekly report from the US Department of Agriculture due later on Monday. In China, the most active September soyoil futures at the Dalian Commodity Exchange inched down 0.4 percent.
INDONESIAN PALM TRADES In Indonesia, Jakarta-based PT KBN Nusantara, formerly known as the state marketing centre, sold 1,500 tonnes of crude palm oil at a top price of 7,606 rupiah ($0.832) per kg. Separately, producers in Medan, home to Indonesia's main palm oil export port of Belawan, did not hold any palm oil auction on Monday. Refiners in Jakarta offered refined, bleached, deodorised (RBD) palm oil, used as cooking oil, at 8,000 rupiah per kg.