Malaysian palm oil futures posted their sharpest fall in two-and-a-half months on Tuesday after cargo surveyor data showed little signs of improvement in exports. The February benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange ended nearly 3 percent lower at 2,333 ringgit ($542.56) per tonne, its biggest single-day percentage fall since September 30.
Earlier in the day, it hit its lowest level since December 2 at 2,324 ringgit, a near 4.8 percent fall from a two-month high of 2,442 ringgit hit on Friday. Traded volume stood at 57,960 lots of 25 tonnes each. "Palm fell because of the drastic dip in exports. If this continues, end-stocks could hit a new high of around 3.1 million tonnes at end-December," said a trader based in Kuala Lumpur.
Exports of Malaysian palm oil products for December 1-15 fell 35.6 percent from a month earlier to 466,876 tonnes, data from cargo surveyor Intertek Testing Services showed. Another trader said exports would be the key determinant for market gains. "At present, production is really bad but due to poor exports, the market may not go up much," he said.
"The moment it shows signs of improvement, the market may improve." Output from Malaysia, the world's second largest palm producer, dropped 18 percent in November from a month ago. Inventories, however, remained at a record high as exports weakened by 12 percent to 1.5 million tonnes, government data released last Thursday showed. In other vegetable oil markets, the May soyabean oil contract on the Dalian Commodity Exchange fell 0.2 percent.
Comments
Comments are closed.