Palm dips on weaker rival oils, softer exports; still set for second weekly gain

Malaysian palm oil futures edged lower on Friday, tracking weaker rival edible oils, crude oil prices and softer November export data.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange slid RM9, or 0.22 per cent, to RM4,146 (US$1,000.97) a metric ton in early trade.

The contract has so far risen 0.51 per cent this week and remains on track for a second weekly gain.

Dalian’s most-active soyoil contract fell 1.21 per cent, while its palm oil contract shed 1.42 per cent. Soyoil prices on the Chicago Board of Trade were down 0.31 per cent.

Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

Oil prices extended their decline for a third straight session as the US pushed for a Russia-Ukraine peace deal that could bring more oil supplies onto the global market, while uncertainty over US interest rate cuts curbed investor risk appetite.

Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

The ringgit, palm’s currency of trade, strengthened 0.26 per cent against the dollar, making the commodity more expensive for buyers holding foreign currencies.

Cargo surveyors estimated that exports of Malaysian palm oil products for November 1-20 fell between 14.1 per cent and 20.5 per cent from a month earlier.

India’s palm oil imports are expected to rebound by nearly 20 per cent in the new marketing year, driven by competitive pricing that is helping the tropical oil regain market share.

Thousands of residents in Indonesia’s Riau province palm oil belt protested against the takeover of their plantations by the government’s forestry task force.

Palm oil may fall into a range of RM4,076 to RM4,102 per metric ton, driven by a wave (5), Reuters technical analyst Wang Tao said.

Asian shares extended a global rout as the much-anticipated US jobs data failed to provide clarity on the near-term path for interest rates, with investors returning to dumping risk assets even after Nvidia’s earnings dazzled.

Tags: Malaysia, palm oil, futures, benchmark contract, soyoil