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Malaysian palm oil price near 3-week low on weak soy, easier supply

KUALA LUMPUR: Malaysian palm oil futures prices dipped in trade on Thursday, hitting their lowest levels in nearly three weeks, as they tracked rival soybean oil prices.

    Traders also said palm declined on easing market supply tightness, despite strong export data from cargo surveyors earlier in the day.

    “Chicago has not been very positive. At the same time, tightness is easing, buyers have covered their shipments and there is no stock chasing now,” said a trader from Kuala Lumpur, referring to soy’s performance on the Chicago Board of Trade.

    Soyoil prices fell on market expectation of an upcoming record U.S. crop harvest. The Chicago Board of Trade soybean oil December contract declined 0.2 percent. 

      Palm oil prices are influenced by soyoil, as they both compete for a share in the global vegetable oil market. 

    Benchmark palm oil futures for November on the Bursa Malaysia Derivatives Exchange fell 0.2 percent to 2,520 ringgit ($619) per tonne at the close of trade. It earlier fell to an intraday low of 2,487 ringgit, its weakest levels since Aug. 12.

    Traded volumes stood at 41,775 lots of 25 tonnes each on Thursday evening. Palm is set for a second weekly decline after three earlier weeks of gains. 

    Palm oil product exports rose in August, up 26-27 percent from the month before on a surge in Indian demand, according to data from cargo surveyors Intertek Testing Services and Societe Generale de Surveillance.  

    Palm oil may drop to 2,477 ringgit per tonne after it cleared a support level at 2,511 ringgit, according to Wang Tao,a Reuters market analyst for commodities and energy technicals.

     In other related vegetable oils, the January soybean oil contract on the Dalian Commodity Exchange fell 0.9 percent.- Reuters

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