Palm oil falls on firmer Ringgit, weaker soyoil and crude oil
Malaysian palm futures continued to fall on Monday, for the sixth consecutive session. The market was weighed down by a weaker ringgit, a decline in crude oil, and the weakness of soyoil. Concerns about U.S. trade tariffs also contributed to the drop.
At the close, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange for July delivery fell 64 ringgit or 1.61% to $3,911 ringgit (US$895.58) per metric ton.
The price of crude palm oil futures fell on the back of lower soybean oil and crude oils, reflecting the global negative sentiment resulting from U.S. tariff policies. David Ng is a proprietary trader with Kuala Lumpur based trading firm Iceberg X Sdn. Bhd.
A stronger ringgit can also be seen as a factor that affects prices.
Dalian's palm oil contract, which is the most active contract, fell by 1.18%. Chicago Board of Trade soyoil prices rose 0.6%.
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price fluctuations of competing edible oils.
Exports of palm oil products from Malaysia between April 1-20 increased between 11.9% to 18.5% compared to the same period last month.
Investors remain concerned by the economic impact of tariffs that could reduce demand for fuel. Oil prices dropped more than 2% as a result of signs of progress between the U.S.
Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.
The palm ringgit's trade currency strengthened by 0.98% against dollars, increasing the price of the commodity for buyers who hold foreign currencies.
(source: Reuters)
