Malaysian palm oil futures fell nearly 2 percent on Monday after earlier hitting their highest level in nearly two years, weighed down by weaker-than-expected export data. The palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange lost 1.8 percent to reach 2,592 ringgit ($628.36) per tonne at the close of trade. The contract earlier hit a high of 2,648 ringgit, its highest since April 29, 2014.
Traded volume stood at 40,771 lots of 25 tonnes each. "The market was earlier up on Chicago Board of Trade soyoil and Dalian palm olien," said a trader based in Kuala Lumpur. "Now it is down on export figures," the trader added. Palm oil shipments from Malaysia fell in the first half of February, dropping 16.1 percent compared with a month ago according to Intertek Testing Services cargo surveyor data, while Societe Generale de Surveillance registered a 14.2 percent fall.
Exports fell due to weak demand from top palm importers China and India. Shipments of the tropical oil have been falling in recent weeks as a slowing Chinese economy eases demand for palm. The winter season in the northern hemisphere also reduces demand for palm, as the vegetable oil solidifies in cold climates. Palm oil still targets 2,672 ringgit per tonne, as suggested by its wave pattern and a Fibonacci projection analysis, said Wang Tao, Reuters market analyst for commodities and energy technicals. In competing vegetable oil markets, the May soybean oil contract on the Dalian Commodity Exchange gained 2 percent.
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