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KUALA LUMPUR, July 6 (Reuters) – Malaysian palm oil futures plunged more than 8% on Wednesday to a near one-year low, hit by anticipation of rising supplies amid a sell-off in crude and Dalian oils driven by recession fears.
The benchmark palm oil contract FCPOc3 for September delivery on the Bursa Malaysia Derivatives Exchange fell 348 ringgit, or 8.34% to 3,426 ringgit ($774.76) a tonne by 0307 GMT.
Palm extending losses for a fourth straight session, hitting their lowest since July 9, 2021.
FUNDAMENTALS
* Malaysia’s end-June palm oil inventories likely climbed 12.3% from the month before to their highest levels in seven months, as exports plunged following top producer Indonesia’s return to the export market, a Reuters poll showed on Tuesday.
* Dalian’s most-active soyoil contract DBYcv1 fell 6.5%, while its palm oil contract DCPcv1 plunged 8.1%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.9%.
* Crude oil futures rose as investors piled back in after a 9% loss on Tuesday, shifting their focus again to supply concerns even as worries about a recession mounted. O/R
* Weaker crude makes palm a less attractive option for biodiesel feedstock.
* Palm oil may test a support at 3,900 ringgit per tonne, a break below could open the way towards 3,592-3,782 ringgit range, Reuters technical analyst Wang Tao said. TECH/C
MARKET NEWS
* Asian stocks slipped and the dollar stood by a two-decade high on the euro, as investors’ fears deepened that the continent is leading the world into recession, while oil and European equity futures attempted to steady after a slide. MKTS/GLOB
DATA/EVENTS (GMT)
0600 Germany Industrial Orders MM May
1345 US S&P Global Comp, Svcs Final PMIs June
1400 US ISM N-Mfg PMI June
1800 US Federal Open Market Committee issues minutes
from its June 14-15 meeting
($1 = 4.4220 ringgit)
(Reporting by Mei Mei Chu; Editing by Rashmi Aich)
((Meifong.chu@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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