Malaysian palm oil futures extended falls into a fourth session on Thursday, hitting their lowest in nearly five months in the evening, tracking weakness in related edible oils. The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange closed 1.3 percent down at 2,502 ringgit ($612.33) a tonne, having touched its lowest since July 19 at 2,499 ringgit.
Palm oil has shed about 3.9 percent so far this week, heading for a sixth weekly fall, and is down by about 10 percent since Nov. 1. Traded volumes stood at 32,052 lots of 25 tonnes each by Thursday evening.
"Palm fell in the evening in line with sharper declines seen in soyaoil on the Chicago Board of Trade," one Kuala Lumpur-based trader said, adding that heavy losses on China's Dalian Commodity Exchange could extend palm's downside. "I'm also worried about the stock levels in the country," another trader said.
November's palm oil inventory levels are expected to come in at 2.44 million tonnes, up 11.4 percent from the previous month, a Reuters poll showed. Official data from the Malaysian Palm Oil Board is scheduled for release on Dec. 12. That would be Malaysia's highest stock level in two years. In related oils, the January soyabean oil contract on the Chicago Board of Trade fell 0.6 percent and the January soyabean oil contract on the Dalian Commodity Exchange retreated by 2 percent.
The Dalian January palm olein contract declined by 1.7 percent. Palm oil prices are affected by movements in other edible oils competing in the global vegetable oils market.
Palm oil could test support at 2,519 ringgit a tonne, a break below which could cause a loss to the next support at 2,491 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
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