Palm oil extends falls on higher output estimates, weaker rivals
25/07/2024 (Reuters), Beijing - Malaysian palm oil futures fell for a third session on Thursday, weighed down by weaker competing edible oils and forecasts of higher output as traders shrugged off Indonesia's plan to raise its biodiesel content.
The benchmark palm oil contract FCPOc3 for October delivery on the Bursa Malaysia Derivatives Exchange slid 10 ringgit, or 0.25%, to 3,915 ringgit ($838.78) a metric ton by the midday break.
The Malaysian Palm Oil Association has estimated production during July 1-20 rose nearly 15% from a month ago, traders and analysts said.
Indonesia, the world's biggest palm oil producer, is testing fuel with a view to increasing to 40% from 35% the share of palm-oil blended into biodiesel next year, the energy ministry said.
Dalian's most-active soyoil contract DBYcv1 fell 1%, while its palm oil contract DCPcv1 lost 1.6%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.6%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Oil prices eased as concerns over weak demand in China, the world's largest crude importer, and expectations of a nearing ceasefire deal in the Middle East overcame gains in the previous session after draws in U.S. inventories.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock. Palm oil may fall to 3,881 ringgit per metric ton, driven by a wave C, Reuters technical analyst Wang Tao said.