KUALA LUMPUR: Malaysian palm oil futures fell to a two-week low on Friday and were set for a near 10% weekly decline, as expectations of increasing palm and rival soybean supplies weighed on prices.

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange slid 72 ringgit, or 1.9%, to 3,727 ringgit ($905.93) a tonne by the midday break, its lowest since March 5.

Cargo surveyors are scheduled to release March 1-20 export data on Saturday, but traders are anticipating slower shipments amid industry forecasts of a double-digit jump in production.

Prices are reversing lower quite aggressively on expectations of higher production, a Kuala Lumpur-based trader said.

Palm prices had hit 13-year highs earlier this week.

US President Joe Biden’s green fuel push using edible oils is helping drive up vegetable oil prices that are already near record highs, hitting key cost-sensitive consumers in India and Africa and stoking global food inflation fears.

Meanwhile, better crop weather in drought-hit South America weighed on the soybean market.

Soyoil prices on the Chicago Board of Trade were down 0.6%. Dalian’s most-active soyoil contract fell 2.4%, while its palm oil contract declined 1.8%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Oil prices edged up, but were still down more than 8% for the week as a new wave of COVID-19 infections across Europe spurred fresh lockdowns and dampened hopes that an anticipated recovery in fuel demand would come soon. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.