Malaysian palm oil futures fell 1.1 percent on Monday with few leads as US markets were shut for a holiday although investors feared hot and dry weather might slash soy crop yields in the Midwest and spur demand for the Asian edible oil. Firm palm oil exports have given support to benchmark palm oil futures that have lost about a fifth so far this year on high stocks, concerns over global economic slowdown and volatile financial markets.
"Palm oil traders are clearly watching for any developments in the US Midwest as worse weather could prompt buyers to look at sourcing palm oil," said a trader with a foreign commodities brokerage. "We have ample palm oil stocks and in September there should be a slight recovery in production." The benchmark November crude palm oil contract settled down 32 ringgit at 3,018 ringgit ($1,018.13) a tonne.
Traded volumes were still thin at 11,999 lots of 25 tonnes each versus the usual 25,000 lots after markets opened from a long holiday last week and amid weak interest since US markets were shut for a public holiday. Technicals were neutral with Reuters analyst Wang Tao saying the benchmark contract was hovering around a resistance of 3,056 ringgit per tonne.
Palm oil exports for August dipped from a month ago although traders said this could cut into high stocks given lower production last month as estate workers took leave for the Eid holidays marking the end of the fasting month of Ramazan. "September will be interesting, we should see some slowdown in exports and production should be better with the workers back in the estates," said another Malaysian trader. Lower crude oil limited gains for vegetable oil markets. The most active May 2012 soy oil on China's Dalian Commodity Exchange fell 0.2 percent.
Comments
Comments are closed.