Malaysian palm oil futures hit a near six-month low on Tuesday, tracking rival soyaoil on the Chicago Board of Trade which fell nearly 1 percent overnight, and ahead of the release of official output and export data next week. The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was down 1.1 percent at 2,631 ringgit ($593.91) a tonne at the end of the trading day. It earlier hit 2,627 ringgit, its weakest since Oct. 14.
Traded volumes stood at 48,853 lots of 25 tonnes each. "The market fell tracking soyaoil, while waiting for new leads," said a futures trader in Kuala Lumpur. Upcoming inventory data from the Malaysian Palm Oil Board (MPOB) will be impacted by local consumption, as production and exports are "expected to offset each other," the trader added.
Data from official industry regulator MPOB is forecast to show rising production and exports, and is scheduled for release on April 10.
Output of the tropical oil at the world's second largest producer could rise in March, in line with the seasonal trend, but production growth is expected to be small, according to traders. In February, production declined 1.4 percent on-month, while exports saw a 14 percent drop. Palm oil shipments for March saw a near 7 percent gain from a month earlier, cargo surveyor data showed last week. Palm oil seems to have found a support at 2,638 ringgit per tonne, and it may continue to hover above this level or bounce towards a range of 2,685-2,715 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals. On Tuesday, CBOT soyabean oil was down 0.1 percent. China's Dalian Commodity Exchange is closed for a national holiday.