Friday, 21 August 2015 12:17
JAKARTA: Malaysian palm oil futures marked time on Friday but were still set to post their longest weekly losing streak since 1999, down 1.5 percent for the week and heading for an eighth consecutive weekly loss.
Palmoil has fallen about 12 percent in the past eight weeks and is sitting near recent 11-month lows, hurt by worries about higher production, slowing import demand in China and a global commodities rout. The benchmark palm oil contract for November on the Bursa Malaysia Derivatives Exchange edged up 0.05 percent to 1,998 ringgit ($ 477.99) a tonne by the midday break, after falling a combined 3 percent in the previous two sessions.
A weak Malaysian ringgit, which makes palm cheaper for offshore buyers, has lent some support.
Traded volume stood at 21,711 lots of 25 tonnes each at midday, well above the roughly 13,500 lots usually traded by midday.
Technical analysis suggests palm oil may drop to 1,976 ringgit per tonne, said Wang Tao, a Reuters market analyst.
Overnight gains in soybean oil futures and persistent weakness in the ringgit had provided temporary support for palm prices, a trader in Kuala Lumpur said.
The ringgit fell to a fresh 17-year low earlier on Friday as investors awaited foreign exchange reserve data for signs on how much ammunition the central bank has left to defend the currency. The ringgit is the worst performing currency in the region, losing more than 15 percent this year.
US soybean futures rebounded from near six-year lows overnight in a short-covering bounce and as weekly government data showed solid soybean and soymeal export sales last week.
In early Asian trading, the US September soyoil contract was down 0.03 percent, while the most active soybean oil contract on the Dalian Commodity Exchange was up 0.3 percent.
Oil prices fell again on Friday, pulled lower by weaker global stock markets and a sharp contraction in China’s manufacturing activity, with the US benchmark on track for its longest weekly losing streak since 1986.
