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Updates prices, comments
JAKARTA, Feb 21 (Reuters) – Malaysian palm oil futures traded slightly lower on Tuesday on profit-taking after a three-day rally tracking weakness in U.S. soyoil prices, but concerns over potentially lower production underpinned prices.
The benchmark palm oil contract FCPOc3 for May delivery slipped 0.02% to 4,166 ringgit ($940.41) per tonne by midday break, after gaining 5.79% in the last three sessions.
“BMD CPO futures seen trading sideways on profit taking, following weakness in CBOT soyoil futures in Asian hours and a lack of follow-up buying from destination markets as the stocks are reasonably high,” said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.
“On the other hand, the production prospects are not seen good at both Malaysia and Indonesia this month.”
The contract dropped as much as 0.86% before regaining some of the losses.
Market participants used the earlier correction as a window for bargain buying, prompted by a rebound on the Dalian market, a Kuala Lumpur-based trader said.
Soyoil prices on the Chicago Board of Trade dropped 0.28% after reopening from a long weekend. Meanwhile, Dalian’s most-active soyoil contract DBYv1 gained 0.11%, after dropping 0.36% earlier in the session, while its palm oil contract DCPv1 rose 0.61%.
Palm is affected by price movements in related oils, as they compete for a share in the global vegetable oils market.
Malaysian palm oil product exports for Feb. 1-20 rose between 27.7% and 33.1% from a month earlier, data from independent inspection company AmSpec Agri Malaysia and cargo surveyor Intertek Testing Services showed on Monday.
Cargo surveyor Societe Generale de Surveillance said on Tuesday Malaysian palm oil exports rose 8.8% for the same period.
Palm oil may break a resistance at 4,196 ringgit per tonne, and rise towards a narrow range of 4,311-4,343 ringgit, said Reuters technical analyst Wang Tao. TECH/C
($1 = 4.4300 ringgit)
(Reporting by Fransiska Nangoy, Bernadette Christina Munthe; Editing by Subhranshu Sahu and Rashmi Aich)
((Fransiska.Nangoy@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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