Palm oil prices end lower due to profit-taking and losses in Dalian contracts
Malaysian palm futures ended Monday lower as investors booked profits and added to the decline.
The benchmark palm-oil contract for delivery in November on the Bursa Derivatives Exchange fell 44 ringgit or 1.11% to 3,933 Ringgit ($903.10) per metric ton.
A Kuala Lumpur-based broker said, "The benchmark is experiencing a correction due to profit taking following the recent rally. It also tracks a decline in Dalian Palm Oil."
Dalian's palm oil contract, which is the most active contract, fell by 1.76% while Dalian's soyoil contract declined by 1.24%.
Chicago Board of Trade will be closed on a holiday.
As they compete to gain a share of the global vegetable oil market, palm oil monitors price movements for related oils.
According to Amspec Agri, Malaysian palm oil exports in August totaled 1,376,412 tons.
Intertek Testing Services, a cargo surveyor, said that the exports of Malaysian products containing palm oil for August decreased 9.9% from July to 1,445,442 tons.
Indonesia increased its crude palm oil reference price (CPO) for September from $820.11 per metric ton in August to $839.53, according to a Friday trade ministry regulation.
The traders are also cautious as India, a major importer, is considering an increase in import tax on vegetable oils. This could impact demand for palm oil.
The Malaysian Ringgit, the palm oil's trade currency, fell 0.74% in value against the US dollar. Palm oil becomes more appealing to foreign currency holders when the ringgit is weaker.
Oil prices continued to fall on Monday, as investors awaited higher OPEC+ output in October. Meanwhile, signs of a sluggish Chinese and US demand raised concerns over future consumption growth.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
(source: Reuters)
