KUALA LUMPUR: Malaysian palm oil futures reversed gains from the more than two-year high reached the previous day, as the market reacted to revised industry data and a strengthening ringgit on Tuesday.

Benchmark palm oil futures for January on the Bursa Malaysia Derivatives Exchange dropped 2.2 per cent to 2,760 ringgit ($664.26) a tonne at the market close. Traded volumes stood at 51,328 lots of 25 tonnes each.

A trader based in Kuala Lumpur noted that the market had been driven by the data received over the two days, as well as the strengthening ringgit.

“The amendment to the Malaysia Palm Oil Association output data, from a 11pc decline announced yesterday to 3.9pc increase amended today, has significantly impacted the market. People took the numbers seriously,” he said.

The trader added there could be a further market correction over the next few days, as futures traders who thought prices could trend up to the 2,900 ringgit level, sell off in light of the new data.

Published in Dawn October 26th, 2016