KUALA LUMPUR: Malaysian palm oil futures shed the previous session’s gains to edge lower on Monday evening as traders locked in gains and sold on technical data reflecting a bearish outlook.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange was down 0.8 per cent at 2,172 ringgit ($525.91) a tonne at the close of trade.
Palm rose 0.3pc last Friday, supported by a soft ringgit that declined 0.3pc. Palm prices are affected by the movement in ringgit as strengthening in the currency makes the commodity more expensive for foreign buyers.
The market seemed uncertain despite a rally in crude oil, a Kuala Lumpur-based trader said. “This is perhaps because there is some technical selling and profit-taking after the price failed to sustain above 2,200 ringgit this morning,” the trader said.
“Initial expectations are that end-stocks may draw down to 2.5 million tonnes by July, but it is not clear if that is achievable now,” the trader said.
The May soyoil contract on the Dalian Commodity Exchange slipped 0.3pc, and the Dalian May palm oil contract fell 1pc. Palm oil prices are affected by movements in soyoil, as they compete for a share in the global vegetable oil market.
Published in Dawn, April 23rd, 2019
