KUALA LUMPUR, Oct 22: alaysian palm oil futures ended 1.8 per cent lower on Monday as rival soybean oil and crude oil fell, pulling prices from record highs hit last week.

Traders said investors might start to cash in profits as the market had been heavily overbought for nearly two weeks.

The benchmark January contract on the Bursa Malaysia Derivatives Exchange settled down 51 ringgit at 2,714 ringgit ($805), after going as low as 2,699 ringgit.

Palm oil struck a record high of 2,795 ringgit on Friday, climbing nearly 8 per cent in close to two weeks.

If soyaoil and crude continue with their downward descent,palm oil is also going to get dragged down very significantly, said one trader. Profit taking is still tentative but it’s going to gush over once these external factors tumble down.

Other traded months fell between 30 and 66 ringgit. Overall traded volume stood at 10,122 lots of 25 tons each.

On Monday, the contract fell more than 1.3 per cent to 40.03 cents per pound.

Oil fell below $88 on Monday as financial markets tumbled on fresh concerns over the health of the US economy. US crude was down 75 cents at $87.85, retreating further from the $90.07 all-time high it hit on Friday.

Healthy export demand for palm oil, used in products ranging from sweets and cosmetics to biofuels, is expected to underpin the commodity’s high prices, traders said. Prices may be high but food demand for the festival season is bound to support, said a dealer with a foreign brokerage.

Exports of Malaysian palm oil products during Oct. 1-20 were almost unchanged, slipping 2 per cent to 874,276 tons from 892,172 tons shipped between Sept. 1 and 20, cargo surveyor Intertek Testing Services said on Saturday.

In Malaysia’s physical market, crude palm oil for October and November shipments in the southern region were quoted at 2,840/2,850 ringgit a ton. Trades were done between 2,840 and 2,845 ringgit.—Reuters