Malaysian palm oil futures dropped on Tuesday evening, hitting their lowest point in more than a week, weighed down by weaker performing rival soyaoils on China's Dalian Commodity Exchange and the Chicago Board of Trade. Palm's movement has been volatile the past week, up on stronger soyaoil movements but weighed down by weaker export demand. The market fell for a second consecutive session on Tuesday at the close of trade.
Benchmark palm oil for January on the Bursa Malaysia Derivatives Exchange was down 1.1 percent at 2,732 ringgit ($654) a tonne in the evening. It earlier hit an intraday low of 2,730 ringgit, its weakest level since October 21. Traded volumes stood at 31,848 lots of 25 tonnes each in a day, below the 2015 daily average of 44,600 lots.
"There was some Dalian weakness in the afternoon, so there was some profit taking there," said a Kuala Lumpur-based futures trader. "Then soyabean oil dropped before we opened for the afternoon session," he said, referring to soyaoil futures on the Chicago Board of Trade. Palm oil prices are impacted by the movements of related vegetable oils as they compete for a share in the global edible oils market.
The December soyabean oil contract on the Chicago Board of Trade fell 0.5 percent, while the January soyabean oil contract on China's Dalian Commodity Exchange declined 0.6 percent. In related vegetable oils, the January contract for palm olein on China's Dalian Commodity Exchange was down 1.5 percent.
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