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By Mei Mei Chu
KUALA LUMPUR, Feb 27 (Reuters) – Malaysian palm oil futures edged lower for a second consecutive session on Monday as traders booked profits, but robust exports and a weaker ringgit kept losses in check.
The benchmark palm oil contract FCPOc3 for May delivery on the Bursa Malaysia Derivatives Exchange slid 37 ringgit, or 0.88%, to 4,165 ringgit ($931.77) a tonne by the midday break, easing from a seven-week high hit last week.
Technical selling and profit-taking following a weaker tone in other markets dragged prices lower after a falling ringgit and steady exports failed to support prices, a Kuala Lumpur-based trader said.
Exports of Malaysian palm oil products for Feb. 1-25 rose between 15.3% and 25.4% from the same week in January, cargo surveyors said on Saturday.
The ringgit MYR=, palm’s currency of trade fell 0.8% against the dollar to its lowest since Nov. 30, making the commodity cheaper for holders of foreign currency.
Dalian’s most-active soyoil contract DBYcv1 slipped 0.3%, while its palm oil contract DCPcv1 fell 0.5%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.4%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Oil prices inched lower in volatile trade, as a stronger dollar and fears of a recession offset gains arising from Russia’s plans to deepen oil supply cuts. O/R
Weaker crude futures make palm a less attractive option for biodiesel feedstock.
Palm oil may test a support of 4,155 ringgit per tonne, a break below could open the way towards the 4,039-4,083 ringgit range, Reuters technical analyst Wang Tao said. TECH/C
($1 = 4.4700 ringgit)
(Reporting by Mei Mei Chu; Editing by Rashmi Aich and Savio D’Souza)
((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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