Malaysian palm oil futures declined for a second straight session on Monday evening, weighed down by higher September end-stocks and on a technical correction. Benchmark palm oil futures for December on the Bursa Malaysia Derivatives Exchange were down 0.7 percent at 2,542 ringgit ($612) a tonne at the end of the trading day. Palm fell 0.7 percent in the previous session, and 2.8 percent last week, its sharpest drop since the week ending July 8.
Traded volumes stood at 42,420 lots of 25 tonnes each on Monday evening, just below the 2015 daily average of 44,600 lots. "Stocks came above market expectations," said a futures trader based in Kuala Lumpur, referring to industry data released by regulator the Malaysian Palm Oil Board (MPOB) on Monday.
Inventories rose 5.7 percent to 1.55 million tonnes, while exports dropped by 20.4 percent. Output rose a marginal 0.8 percent on the month to 1.72 million tonnes in September, according to government data. Palm oil shipments, however, rose in the first 10 days of October. They gained 10.8 percent from the corresponding period last month on stronger demand from Europe, according to data from cargo surveyor Intertek Testing Services.
Data released by another cargo surveyor, Societe Generale de Surveillance, however showed a smaller 1.9 percent gain in Malaysian exports during the same time period. Another trader added the market could be lower on a technical correction, and would only "retrace higher in an oversold condition." In other related vegetable oils, the soyabean oil December contract on the Chicago Board of Trade was down 0.4 percent, while the January soyabean oil contract on the Dalian Commodity Exchange gained 0.7 percent.
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