Malaysian palm oil futures fell more than 1 percent on Wednesday evening, dipping to their lowest in nearly three weeks, as they tracked weaker-performing soyaoil on the Chicago Board of Trade and China's Dalian Commodity Exchange. The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was down 1.4 percent at 2,581 ringgit ($601.49) a tonne at the close of trade, recording a second straight session of declines.
Earlier in the session, it hit 2,579 ringgit a tonne, its lowest since May 5. Traded volumes stood at 47,257 lots of 25 tonnes each in the evening. "We are down on external factors," said a futures trader from Kuala Lumpur, referring to related vegetable oils in markets abroad. "But the market is trying to hold in anticipation of better export figures tomorrow." Export data from cargo surveyors for the May 1-25 period is scheduled for release after 0300 GMT on Thursday. Shipments from Malaysia, the world's second-largest producer of the tropical oil, rose 18-20 percent during May 1-20 versus the corresponding period last month.
Traders forecast a surge in demand during May, as major consumers such as India, Pakistan and the Middle East ramp up palm oil consumption ahead of Ramazan, which begins this week. Palm oil may break a support at 2,600 ringgit per tonne and fall to the next support at 2,558 ringgit, according to Reuters market analyst for commodities and energy technicals Wang Tao.
In other related vegetable oils, soyabean oil on the Chicago Board of Trade was last trading flat, while the September soyabean oil contract on the Dalian Commodity Exchange shed up to 1.3 percent. The September contract for palm olein dipped as much as 1.5 percent. Palm oil prices are impacted by the performance of rival edible oils such as soyaoil, as they compete for a share in the global vegetable oils market.
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