JAKARTA: Malaysian palm oil futures closed lower on Thursday, triggered by a sell-off after news of Indonesia’s palm oil B40 delay caused market uncertainties.
Indonesia has yet to implement a higher mandatory blend of biodiesel planned for Jan. 1 as industry participants await the technical regulations for the rollout, causing confusion among palm oil traders. “The news definitely gave the push for market to go down. The delay will have a significant impact,” a Kuala Lumpur-based trader said.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange fell 2.52% to 4,336 ringgit ($968.72) a metric ton at the close, after rising about 1.8% earlier in the day.
Dalian’s most-active soyoil contract gained 0.13% while its palm oil contract flipped to a 2.33% decline. The Chicago Board of Trade soyoil is closed for the New Year holiday.
Indonesia slightly lowered its crude palm oil reference price for January to $1,059.54 a ton from $1,071.67 in December, according to a trade ministry regulation published on Tuesday.
Exports of Malaysian palm oil products for December fell 2.5%, according to AmSpec Agri Malaysia, while Intertek Testing Services said they fell 7.8%.
The ringgit, palm’s currency of trade, fell 0.18% against the US dollar, making the commodity cheaper for buyers holding foreign currencies.
Source: Brecorder
