JAKARTA: Malaysian palm oil futures fell for a fourth session on Wednesday to hit their lowest since Nov. 1, tracking weakness in rival vegetable oils despite expectation of lower end-November inventories.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange lost 81 ringgit, or 2.14%, to 3,700 ringgit ($792.12) by the midday break.
“Huge downside in Dalian palm olein has prompted the palm oil prices’ continued negative streak, although late emergence of bargain buyers narrowed losses,” a Kuala Lumpur-based trader said.
Dalian’s most-active soyoil contract fell 1.98%, while its palm oil contract plunged 3.43%. Soyoil prices on the Chicago Board of Trade were down 0.22%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market. According to Refinitiv Commodities Research, weaker rival vegetable oils and gasoil are weighing down palm prices.
The palm market has been volatile due to weakness in rival vegetable oil markets, but destocking prospects could limit the downside.
Palm oil closes lower for third straight day on weak rival oils
European Union palm oil imports so far in the 2023/24 season that started in July had reached 1.48 million tons by Dec. 3 versus 1.64 million a year earlier.
Malaysian palm oil inventories at the end of November were seen falling for the first month since April, as a seasonal output decline was expected to start while exports continued to rise, a Reuters survey showed.
Palm oil may fall into a range of 3,714-3,741 ringgit per metric ton, driven by a wave c, Reuters technical analyst Wang Tao said.
Source: Brecorder
