Palm trades lower than Chicago soyoil amid concerns about economic headwind
Malaysian palm futures continued to fall on Monday as they tracked the weakness of rival soyoil on the Chicago market. Meanwhile, escalating U.S. China trade tensions despite a suspension of tariffs for other countries also weighed down sentiment.
By midday, the benchmark June palm-oil contract traded on the Bursa Derivatives Exchange in Malaysia had fallen 45 ringgit or 1.07% to 4,167 Ringgit ($943.19) per metric ton.
"Following a 90-day suspension of tariffs by the U.S. concerns about broader economic headwinds, and lingering uncertainty have continued to cap the upside of any meaningful amount," said Darren Lim, a commodities analyst at Singapore-based brokerage Phillip Nova.
He added that the downward pressure this morning indicates traders are still unsure about the impact of the suspension on the market in the long term.
Dalian's palm oil contract, which is the most active contract, lost 0.46%. The Chicago Board of Trade's (CBOT's) soyoil price fell by 0.59%.
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price changes of competing edible oils.
A trade group said that India's imports of palm oil in March increased by 14% compared to the previous month, reaching 424,599 tonnes.
AmSpec Agri Malaysia, an independent inspection company, reported that exports of Malaysian products containing palm oil for the period April 1-10 increased by 52.8%, to 301.113 tons. According to Intertek Testing Services, cargo surveyor, it increased by 29.3%, to 323,160 tonnes.
Prices of oil fell amid fears that the trade war between China and the United States would stifle global economic growth.
Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.
The dollar fell 0.05%, making palm cheaper for foreign currency buyers. ($1 = 4.42180 ringgit). (Reporting and editing by Rashmi aich; Dewi Kurniawati)
(source: Reuters)
