Palm oil falls tracking rival edible oils as crude retreats
- Dalian’s most-active soyoil contract was up 0.37%
JAKARTA: Malaysian palm oil futures declined for a second session on Wednesday, tracking the losses of rival edible oils in the Chicago and Dalian exchanges.
The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange was down 26 ringgit, or 0.56%, at 4,632 ringgit ($1,120.19) per ton at closing.
The contract traded in a tight range between 4,622 ringgit and 4,690 ringgit per ton during the day.
“The market is likely to stay range-bound, tracking muted moves in rival vegetable oils and the energy market,” a Kuala Lumpur-based trader said.
Dalian’s most-active soyoil contract was up 0.37%, while soyoil prices on the Chicago Board of Trade lost 0.42%. The most-active palm oil contract on the Dalian exchange was trading 0.46% lower.
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 1% on Wednesday, extending this week’s losses and trading near four-month lows, on signs that more oil tankers stranded in the Gulf are set to move out of the Strait of Hormuz.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Palm oil may retrace into a range of 4,574 ringgit to 4,606 ringgit per metric ton, Reuters technical analyst Wang Tao said.