Malaysian palm oil futures fell to a two week low on Friday over concerns of rising stocks, a stronger ringgit and weaker related edible oils. A stronger ringgit usually makes palm oil more expensive for holders of foreign currencies. The ringgit, palm's currency of trade, was up 0.1 percent to 4.1370 against the dollar on Friday evening.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange was down 0.9 percent at 2,222 ringgit ($537.10) a tonne on Friday evening, its weakest since Aug. 30. The market is also down 1.9 percent for the week, its sharpest weekly decline since mid-July.
Trading volumes stood at 56,902 lots of 25 tonnes each at the end of the trading day. "There are talks of high stocks and rising production," said a Kuala Lumpur based trader. "Exports will be good but not enough (to reduce stocks) so stocks are still expected to rise."
Another futures trader earlier said palm eased due to overnight weakness in soyaoil on the Chicago Board of Trade and weak China's Dalian Commodity Exchange, along with a firmer ringgit. Malaysian markets will be closed on Monday for a national holiday, and will resume trading on Sept. 18.
In other related oils, the Chicago September soyabean oil contract fell 0.7 percent on Thursday after US President Donald Trump said the United States was under no pressure to make a trade deal with China, the biggest buyer of the oilseed.
Meanwhile the January soyabean oil contract on China's Dalian Commodity Exchange dropped 0.3 percent, and the Dalian January palm oil contract was 0.7 percent lower. Palm oil prices are impacted by movements of other edible oils, as they compete for a share in the global vegetable oils market.
Comments
Comments are closed.