Monday, 27 July 2015 13:38
JAKARTA: Malaysian palm oil futures declined to their lowest in nearly three weeks on Monday as traders sold positions after data showed exports fell this month, and as competing oil markets weighed on prices.
By the midday break, the benchmark palm oil for October delivery on the Bursa Malaysia Derivatives Exchange had slipped 0.92 percent to 2,158 ringgit ($ 565.96) a tonne. The contract hit 2,144 ringgit, its lowest since July 8, earlier in the session.
Total traded volume stood at 18,621 lots of 25 tonnes each, above the average 13,500 lots traded by midday.
“The market is weak. The export figure is bearish,” said a trader with a foreign commodities brokerage in Kuala Lumpur, adding that competing markets also fell.
“Every indicator points to the market being weak, and our palm will continue the movement down.”
Export data released by cargo surveyor Intertek Testing Services (ITS) for July 1-25, showed a nearly 18 percent decline in shipments of Malaysian palm oil at 1,152,045 tonnes compared with 1,400,162 tonnes shipped during June 1-25.
For palm prices to break the current downtrend, exports need to pick up, the trader said.
“We need demand from the consuming countries because from this point onwards, all the way to November, our production will be rising.”
In competing markets, oil prices fell on Monday after closing the previous session at their lowest levels since March on renewed oversupply concerns from the United States and Iraq, although a weaker dollar helped to limit deeper losses.
The US soyoil contract for August was down 0.39 percent in early Asian trade, while the most active January soybean oil contract on the Dalian Commodity Exchange lost 1.82 percent. Dalian RBD palm oil for September delivery was down 1.72 percent.
Chicago Board of Trade November soybean futures was down 1.35 percent at $ 9.52 a bushel, near the session low of $ 9.50 a bushel – the lowest since June 23. Soybeans have dropped for nine sessions out of 10.