Malaysian crude palm oil futures ended lower on Tuesday, hit by profit taking after strong gains a day, dealers said. The benchmark third-month November contract on the Bursar Malaysia Derivatives exchange ended down 13 ringgit at 1,597 ringgit a tonne ($435) after trading as high as 1,618 ringgit.
Other traded contracts were down eight to thirteen ringgits. Overall volume was at 13,013 lots of 25 tonnes each against on Monday's 10,870 lots.
"The market was down a bit today. There was a bit of selling speculation and a lot of people took profits," a Malaysian dealer in Kuala Lumpur said. However, fundamentals for crude palm oil remain strong, backed by demand for biofuels as countries sought ways to cut dependence on expensive crude oil. "Fundamentals for short-term and long-term remain strong. But, for day-to-day events, a lot of speculation is going on in the market nowadays," the dealer said.
"It's a wide swing, up and down. It went up 20-30 ringgit and the next one, two days, it swung down again," another dealer said. Oil held steady at $72.50 a barrel on Tuesday, underpinned by Iran's determination to continue enriching uranium and run a risk of international sanctions.
The Kuala Lumpur market should move in a tight range on Wednesday with immediate resistance at 1,630 ringgit and support at 1,590 ringgit, dealers said.