KUALA LUMPUR: Malaysian palm oil futures closed more than 3 per cent down on Thursday after the World Health Organisation (WHO) described the coronavirus outbreak as a pandemic, rattling global markets.

The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange closed 80 ringgit, or 3.4pc down at 2,278 ringgit ($534.87) a tonne. Palm oil has declined more than 7pc this week, dragged down by a sharp drop in crude oil prices and the rapid global spread of the coronavirus despite lower February stockpiles and improving exports ahead of the Muslim holy month of Ramadan.

“We’re in uncharted waters,” said Marcello Cultrera, institutional sales manager at Phillip Futures in Kuala Lumpur.

The WHO on Wednesday said it was deeply concerned by the alarming spread and severity of the virus outbreak, adding that Italy and Iran are now on the frontline of the disease and other countries would soon join them.

Palm oil has fallen by about 28pc since January, breaking a three-month rally to trade just above October levels.

Published in Dawn, March 13th, 2020