MARKET DEVELOPMENT
Palm falls as crude, rival oils weaken amid Omicron fears
Palm falls as crude, rival oils weaken amid Omicron fears
20.12.2021 (www.hellenicshippingnews.com) - Malaysian palm oil futures fell on Monday as crude and rival vegetable oil prices weakened on concerns that surging Omicron cases globally would hurt demand, while December export data is likely to remain soft.
The benchmark palm oil contract FCPOc3 for March delivery on the Bursa Malaysia Derivatives Exchange fell 1.20% to 4,355 ringgit ($1,031.26) by the midday break.
Palm followed the drop in rival oils on the Dalian commodity exchange as well as the energy prices, while December exports are expected to remain muted, a Kuala Lumpur-based trader said.Cargo surveyors’ data showed Malaysia’s exports during Dec. 1-15 fell between 9% and 12.5% from the same period in November, more than the market had anticipated, which last week led palm futures to post their worst week since June.
Dalian’s soyoil contract DBYv1 fell 1.12% while its palm oil contract DCPcv1 lost 2.09%, while soybean oil prices on the Chicago Board of Trade BOc2 for May delivery fell 1.35%.
Meanwhile, oil prices slumped as surging cases of the Omicron coronavirus variant stoked investor worries that new restrictions on businesses to combat its spread may hit fuel demand, while there were signs of improving supply. O/RPalm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market while weaker crude oil futures typically make palm a less attractive option for biodiesel feedstock.
On the technical front, the palm oil contract may fall into a range of 4,237-4,298 ringgit per tonne, as the downtrend may have resumed, according to Wang Tao, a Reuters market analyst for commodities and energy technicals.
Source: Reuters (Reporting by Fransiska Nangoy; Editing by Subhranshu Sahu and Vinay Dwivedi) https://www.hellenicshippingnews.com/palm-falls-as-crude-rival-oils-weaken-amid-omicron-fears/