VEGOILS-Palm nears one-month low after commodities' heavy selling, subdued demand
31/05/2023 (Nasdaq), Jakarta - Malaysian palm oil futures plunged for a third session on Wednesday and hit their lowest in nearly a month caused by commodities heavy selling, higher palm production, and subdued demand.
The benchmark palm oil contract FCPOc3 for August delivery on the Bursa Malaysia Derivatives Exchange fell 3.59% to 3,281 ringgit ($739.80) per tonne at the midday break.
"Overnight heavy selling across commodity market spilled over to Bursa Malaysia Derivatives' FCPO. Concern of higher palm production and subdued demand brought palm prices down," a Kuala Lumpur-based trader told Reuters.
Malaysia's exports during May 1-25 fell 0.7% from the same period in April, cargo surveyor Intertek Testing Services said on Friday. Another cargo surveyor, AmSpec Agri Malaysia, said exports rose 0.7%.
May production is expected to rise between 20% and 30% from April, rebounding from the lows seen during the Raya holidays, analysts said.
Dalian's most-active soyoil contract DBYcv1 fell 4.03%, while its palm oil contract DCPcv1 was down 4.69%. Soyoil prices on the Chicago Board of Trade BOcv1 dropped 1.36%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil FCPOc3 may revisit its April 28 low of 3,288 ringgit per tonne, as it has broken key support of 3,363 ringgit, said Reuters technical analyst Wang Tao. TECH/C
($1 = 4.4350 ringgit)
Source: Reuters