KUALA LUMPUR: Malaysian palm oil futures fell 4% on Friday as recession fears sank edible oils, with a higher supply outlook further denting sentiment.

The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange fell 207 ringgit, or 4.22%, to 4,703 ringgit ($1,067.41) a tonne, after hitting an intraday low of 7.3%.

Palm recouped some losses as oil prices rose 2% on supply outages in Libya and expected shutdowns in Norway. Stronger crude futures make palm a more attractive option for biodiesel feedstock.

Palm rose 0.84% for the week to end a three-week decline.

Shaky palm fundamentals and a negative macro environment are weighing on palm futures, said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics “Production is expected to rise and exports to fall but the extent of stock rise is the key,” he added.

Malaysia’s exports in June shrank between 7.4% and 13.4% from the previous month as shipments to India and the European Union slowed, cargo surveyors said on Thursday.

Dalian’s most-active soyoil contract fell 5.3%, while its palm oil contract slipped 6.1%. Soyoil prices on the Chicago Board of Trade fell 1.6%.

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