Malaysian palm oil futures fell in late trade on Friday, easing from a more than one-week high reached early in the session, as the market tracked declines in soyaoil on the Chicago Board of Trade. Expectations of rising production as the month progresses also added to traders' concerns and weighed on prices.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was down 0.1 percent at 2,573 ringgit ($600.89) at the close of trade. Palm earlier hit 2,589 ringgit, its highest level since July 12. Traded volumes stood at 33,791 lots of 25 tonnes each on Friday evening.
"The market is profit-taking on weakness from soyaoil, and it is also awaiting production figures," a Kuala Lumpur based futures trader said. Production in Malaysia is forecast to rise for the full month of July, following a surprise drop in June output which saw a decline in productivity as workers went on leave for Ramazan and Eidul-Fitr.
Output is expected to rise in the second half of the year in line with seasonal trends and is expected to peak in October. Palm oil prices are also affected by movements in rival edible oils, as they compete for a share in the global vegetable oils market.
The December soyabean oil contract on the Chicago Board of Trade declined 0.6 percent on Friday, the first decline after three straight days of gains due to dry weather concerns in the United States. In other related oils, September soyabean oil on the Dalian Commodity Exchange rose 0.3 percent.