SINGAPORE: Malaysian palm oil futures declined for a third consecutive session on Wednesday, amid weaker rival oils and lacklustre Chinese economic data, but the contract still logged a monthly gain.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange fell 47 ringgit, or 1.22%, to 3,795 ringgit ($802.83) a metric ton at closing.
For the month, the contract rebounded 1.99%, after falling 4.47% in December.
On the day, palm is tracking lower economic data from China and weakness in competing oils, said Mitesh Saiya, trading manager at Mumbai-based trading firm Kantilal Laxmichand & Co.
China’s manufacturing activity in January contracted for the fourth straight month, an official factory survey showed.
A liquidation order on property giant China Evergrande Group from a Hong Kong court on Monday dealt a fresh blow to the country’s fragile property market, casting a shadow on China’s demand outlook.
Dalian’s most-active soyoil contract dropped 1.29%, while its palm oil contract plunged 2.59%. Soyoil prices on the Chicago Board of Trade were down 1.52%.
“Soybean and corn prices remain under pressure after the supply outlook brightened further recently,” Commerzbank said in a note.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
The soft Chinese data also weighed on Brent crude oil prices. Weaker crude prices make palm a less attractive option for biodiesel feedstock.
Exports of Malaysian palm oil products fell 9.4% to 1,227,101 tons in January, independent inspection company AmSpec Agri Malaysia said. Another independent cargo surveyor, Intertek Testing Services, estimated exports fell 6.7% to 1,286,509 tons this month.
The Malaysian ringgit, palm’s currency of trade, weakened 0.09% against the US dollar, which got a boost from bets that the Federal Reserve would not slash interest rates earlier than expected due to resilient economic data.
Comments
Comments are closed.