Palm follows Dalian palm olein, Chicago soyoil lower
Malaysian palm oil futures dropped for a third day, falling 0.45% to RM4,223 per ton, pressured by weaker soyoil and palm olein prices. Gains in crude oil limited losses, supporting palm’s biodiesel appeal. A weaker ringgit made palm oil cheaper for foreign buyers, though technical charts signal further downside risk.
KUALA LUMPUR: Malaysian palm oil futures fell for a third consecutive session on Tuesday, weighed down by weaker Dalian palm olein and Chicago soyoil, although gains in crude oil prices limited the decline.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange slid RM19, or 0.45 per cent, to RM4,223 (US$997.87) a metric ton in early trade.
Dalian’s most-active soyoil contract rose 0.05 per cent, while its palm oil contract shed 0.56 per cent. Soyoil prices on the Chicago Board of Trade were down 0.54 per cent.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Oil extended gains, lifted by hopes of improved economic activity after the US-EU trade deal, a potential US-China tariff truce and President Donald Trump’s shorter deadline for Russia to end the Ukraine war.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, weakened 0.09 per cent against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.
Palm oil may fall to RM4,161 per ton, as it has pierced below support at RM4,211, Reuters technical analyst Wang Tao said.
Asia shares eased while the euro nursed its losses as investors pondered the downside of the US-EU trade deal and the reality that punishing tariffs were here to stay, with unwelcome implications for growth and inflation.
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Source : The Business Times
