Palm slips, dragged down by rival edible oils, strong ringgit
Malaysian palm oil futures fell on Monday, with the December contract dropping 0.74% to 4,021 ringgit per metric ton, driven by declines in rival edible oils and a stronger ringgit. Soyoil prices in both Dalian and Chicago markets also fell. The strengthening ringgit made palm oil more expensive for foreign buyers. Despite the decline, concerns about oil supply disruptions in the Middle East slightly supported crude prices, benefiting palm oil’s use in biodiesel production.
KUALA LUMPUR, Sept 30 (Reuters) -Malaysian palm oil futures fell on Monday, dragged down by weakness in rival edible oils and strengthening ringgit.
The benchmark palm oil contract FCPOc3 for December delivery on the Bursa Malaysia Derivatives Exchange was down 30 ringgit, or 0.74%, at 4,021 ringgit ($980.01) a metric ton in early trade.
FUNDAMENTALS
* Dalian’s most-active soyoil contract DBYcv1 fell 0.56%, while its palm oil contract DCPcv1 shed 1.37%. Soyoil prices on the Chicago Board of Trade BOcv1 fell 0.57%.
* Palm oil tracks prices of rival edible oils, as they compete for a share of the global vegetable oils market.
* Chicago wheat, soybean and corn futures slipped ahead of the U.S. Department of Agriculture reports later in the day, with analysts expecting the largest Sept. 1 stocks of all three crops since 2020.
* The ringgit MYR=, palm’s currency of trade, strengthened 0.46% against the U.S. dollar, making the commodity more expensive for buyers holding foreign currencies.
* Oil prices edged higher on increasing concerns of potential supply disruptions in the Middle East producing region after Israel stepped up attacks on Iran-backed forces. O/R
* Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
* Malaysia is committed to sustainable palm oil production ahead of the European Union implementing the new law banning imports of commodities linked to deforestation, its commodities minister said last week.
* Palm oil FCPOc3 may test support at 4,017 ringgit per metric ton, a break below could open the way towards the 3,928-3,981 ringgit range, Reuters technical analyst Wang Tao said. TECH/C
MARKET NEWS
* Asia share markets turned hesitant as strife in the Middle East offset more stimulus measures in China, while the Nikkei dived on concerns Japan’s new prime minister favoured normalising interest rates. MKTS/GLOB
DATA/EVENTS
0600 UK GDP YY Q2
0600 UK Nationwide House Price MM Sept
0600 UK Nationwide House Price YY Sept
0600 UK GDP QQ Q2
1200 Germany CPI Prelim YY Sept
1200 Germany HICP Prelim YY Sept
($1 = 4.1030 ringgit)
Source Link : https://www.xm.com/research/markets/allNews/reuters/palm-slips-dragged-down-by-rival-edible-oils-strong-ringgit-53935402
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