KUALA LUMPUR: Malaysian palm oil futures inched lower on Monday, mirroring losses in the Chicago soyoil market but a weaker ringgit limited the fall.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange fell 14 ringgit, or 0.33%, to 4,286 ringgit ($1,003.28) a metric ton during the midday break.
The contract logged a gain of 2.82% last Friday and has recorded three consecutive weekly gains to date.
The Malaysian palm oil futures market took a breather after a strong rally last Friday, a Kuala Lumpur-based trader said.
“A mild pullback in Chicago soyoil prices brought the Malaysian palm oil futures lower this morning,” the trader said.
Soyoil prices on the Chicago Board of Trade were down 1.43%. Dalian’s vegetable oil markets were closed for China’s Golden Week holiday.
Chicago corn and soybean futures lost more ground, as a stronger dollar and expectations of record US supplies continued to provide headwinds to prices.
Palm oil tracks price movements of rival edible oils, as they compete for a share of the global vegetable oils market.
Malaysian palm oil surges on ME conflict
Oil prices pared gains in early trade after charting their biggest weekly rise in over a year on Friday amid mounting threats of a region-wide war in the Middle East.
Brent crude futures for December were down 0.44% at $77.71 a barrel, as of 0434 GMT. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, weakened 1.35% against the dollar, making the commodity cheaper for buyers holding foreign currencies.
Palm oil may extend gains to 4,432 ringgit per metric ton, as it has broken key resistance at 4,293 ringgit, Reuters technical analyst Wang Tao said.
Source: Brecorder
