KUALA LUMPUR: Malaysian palm oil futures fell on Thursday, as profit-taking and lower palm oil exports estimates until February 20 weighed on the market.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange had slid 26 ringgit, or 0.56%, to 4,646 ringgit ($1,049.47) a metric ton at the close. The contract rose 3.73% in the previous session.
The market traded lower after shedding some of its gains made on Wednesday, said Anilkumar Bagani, commodity research head at Mumbai-based Sunvin Group.
Bagani added that market speculation regarding Indonesia’s palm oil export restrictions ahead of Ramadan and the possibility of India raising its vegetable oil import tax from 10% to 15% were also instilling volatility in the market.
Dalian’s most-active soyoil contract rose 0.46%, while its palm oil contract added 2.54%. Soyoil prices on the Chicago Board of Trade were up 0.95%.
Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market. Cargo surveyors estimated that exports of Malaysian palm oil products during February 1-20 fell between 0.3% and 8.1%, compared with the same period a month ago.
The ringgit, palm’s currency of trade, strengthened 0.25% against the US dollar, making the commodity more expensive for buyers holding foreign currencies. Indian refiners have cancelled orders for 70,000 metric tons of crude palm oil (CPO) scheduled for delivery between March and June, because of a surge in benchmark Malaysian prices and negative refining margins in India, four trade sources said.
Oil prices were little changed on Thursday after rising to a near one-week high in the previous session, as an industry report showing a buildup in US crude stockpiles pressured the market.
Malaysia maintained its March export tax for crude palm oil at 10% and lowered its reference price to 4,390.37 ringgit ($988.38) per ton, a circular on the Malaysian Palm Oil Board website showed.
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