NEW DELHI: Malaysian palm oil futures opened lower on Thursday, a day after the industry regulator said inventories in June surged to a four-month high.

Malaysian palm oil futures extend losses on rising stocks

The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange lost 6 ringgit or 0.15%, to 3,912 ringgit ($834.65) in early trading.

Fundamentals

• Malaysia’s palm oil stocks at the end of June rose 4.35% from May to 1.83 million metric tons, the highest since February, the Malaysian Palm Oil Board (MPOB) said on Wednesday.

• The MPOB attributed the rise in stocks to a steeper decline in exports compared to production.

• Crude palm oil production declined 5.23% from May to 1.62 million tons, while palm oil exports plunged 12.82% to 1.21 million tons.

• A Reuters survey had forecast inventories at 1.83 million tons, with output at 1.62 million tons and exports at 1.24 million tons.

• Crude palm oil prices are expected to remain supported by tighter production conditions and strong demand from top buyers India and China, state agency Malaysian Palm Oil Council (MPOC) said.

• Soyoil prices on the Chicago Board of Trade rose 0.9%.

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

• Palm oil may retest support at 3,876 ringgit per metric ton, as its fall looks incomplete.