KUALA LUMPUR: Malaysian palm oil futures fell in early trade on Thursday on the back of a technical correction, falling from their highest in a month hit during the previous session.
Expectations of rising end-stocks also weighed on the market, according to a trader from Kuala Lumpur.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange fell 0.8 percent to 2,586 ringgit ($644.08) a tonne at the midday break, in line for its first decline in three days.
Palm, however, is up 3.3 percent for the week so far, after surging nearly 3 percent in the previous trading session on expectations of improving demand.
Trading volumes stood at 36,621 lots of 25 tonnes each.
“The market is seeing some profit-taking… Today it is undergoing a correction after yesterday,” said a Kuala Lumpur- based trader, referring to Wednesday’s gain.
The market also expects rising end-stocks on-month in Malaysia for December, he added. Stockpiles had already risen to the highest level in nearly two years in November, up 16 percent to 2.56 million tonnes, according to data from the Malaysian Palm Oil Board.
Official data for December will be released on Jan. 10.
In other related oils, the March soybean oil contract on the Chicago Board of Trade was trading flat around 0527 GMT, while the May soybean oil on the Dalian Commodity Exchange was up 0.5 percent.
The Dalian January palm oil contract gained 0.6 percent. Palm oil prices track the performance of other edible oils, as they compete for a share in the global vegetable oils market.
Source: Brecorder.com
