Palm oil prices fall on weaker export data and a muted competition.

Malaysian palm futures fell on Monday, following a drop in the prices of rival oils. The weakening exports of palm oil from Malaysia in February also affected sentiment.

The benchmark May palm oil contract on Bursa Malaysia's Derivatives Exchange fell 71 ringgit or 1.56% to close at $4,483 ringgit per metric tonne.

Anilkumar bagani, the head of research for Mumbai-based Sunvin Group's vegetable oil brokerage, said that "the futures mirror the sell-offs in Chicago's soybean futures on Friday evening and in South American markets and the weakness in Dalian palm olein futures and soyoil in Asian hours."

The market also reacted to the lower performance of Malaysian palm oil in February.

Dalian's palm oil contract, which is the most active contract in Dalian, lost 0.46% while soyoil rose by 0.25%. The Chicago Board of Trade's (CBOT) soyoil price fell by 0.14% from the Friday closing level. However, it reversed its course and closed 0.11% higher.

As palm oil competes to gain a market share on the global vegetable oils, it is affected by price fluctuations in other oils.

According to AmSpec Agri Malaysia, an independent inspection company and cargo surveyor Intertek Testing Services, the exports of palm oil products from Malaysia in February fell by 8.5%-11%.

A trade ministry official announced on Friday that Indonesia had lowered the crude palm oil benchmark price in March to $954.50 a ton, but the export tax would remain at $124 per ton.

The price of oil rose as China's manufacturing data, the largest crude importer in the world, led to renewed confidence for fuel demand. However, uncertainty about a Ukraine deal and potential U.S. trade tariffs continued to loom.

Palm oil is a better option as a biodiesel source because crude oil futures are stronger. $1 = 4.4640 Ringgit (Reporting and editing by Sumana Nady and Eileen Soreng).

(source: Reuters)