JAKARTA: Malaysian palm oil futures fell for a third straight session on Monday as market was disappointed by export data while Indonesia is expected to remove an export restriction that would further increase global supply.
The contract for October delivery on the Bursa Malaysia Derivatives Exchange lost 1.57% to close at 3,646 ringgit ($819.14) per tonne, extending the 6% decline it posted over the previous two sessions.
It rose as much as 2.3% earlier in the session before it erased the gains.
It reversed course after disappointing export data and the market becoming more convinced that Indonesia would soon remove its domestic sales requirement, a palm oil trader in Kuala Lumpur said.
Exports of Malaysian palm oil products for July 1-25 fell 11.3% for the same period in June, cargo surveyor Intertek Testing Services said on Monday, while independent inspection company AmSpec Agri Malaysia said exports fell 2.7%.
Palm oil futures plunge 5% tracking crude, soyoil prices
Indonesia’s trade minister said on Friday the world’s biggest palm oil exporter is considering removing a rule that require palm companies to sell a portion of their products at home to secure export permits as high inventories have been holding back a recovery of palm oil fruit prices.
Malaysian crude palm oil prices are likely to remain weak for most of the third quarter, the country’s commodities minister said on Monday, following rival producer Indonesia’s move to scrapped its export levy.
Meanwhile, Dalian’s most-active soyoil contract lost 0.31%, while its palm oil contract fell 0.49%. 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.
Palm oil may revisit its July 14 low of 3,489 ringgit per tonne, as the bounce from this level has been almost reversed, Reuters technical analyst Wang Tao said.
Source: Brecorder
