The Edge Markets (23/05/2018) - KUALA LUMPUR (May 23): Malaysian palm oil futures declined in trade on Wednesday evening, tracking weakness in crude oil prices and as traders booked profit after the vegetable oil jumped to a six-week high in the previous session.

The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was down 0.2% at RM2,473 (US$621.36) a tonne at the close of trade.

Palm hit its highest since April 9, at RM2,485, in intraday trading on Tuesday and closed the session 1.3% higher at RM2,477, tracking gains in crude oil and US soyoil.

Trading volume stood at 30,099 lots of 25 tonnes each on Wednesday evening.

Weaker crude oil prices along with profit-taking after Tuesday's gain weighed on palm prices, said a Kuala Lumpur-based trader. However, a weaker ringgit could cap the decline, he said.

Weakness in the ringgit, palm oil's currency of trade, would make the tropical oil cheaper for foreign buyers and lift demand. The ringgit had weakened by 0.4% to 3.9800 per dollar by Wednesday evening.

Crude oil prices slipped on Wednesday, under pressure from a potential increase in OPEC crude output to cool the market's recent rally and cover any shortfalls in supply from Iran and Venezuela.

Palm oil prices track movements in crude oil as the vegetable oil is used for feedstock to produce biodiesel.

In other related oils, the Chicago July soybean oil contract was down 0.1%, while the September soybean oil on China's Dalian Commodity Exchange was trading flat at around 1100 GMT.

Meanwhile, the Dalian September palm oil contract edged down 0.3%.

Palm oil is affected by movements in rival edible oils as they compete for a share in the global vegetable oils market.

Palm, soy and crude oil prices, as of 1054 GMT

Contract                       Month     Last    Change    Low    High   Volume

MY PALM OIL               JUN8      2462     -1.00       2453     2463     199

MY PALM OIL               JUL8      2464     -4.00       2455     2474    4301

MY PALM OIL               AUG8     2473     -4.00      2463     2483    13965

CHINA PALM OLEIN    SEP8       5144    -16.00     5132     5194    288120

CHINA SOYOIL           SEP8       5798     +0.00      5782     5848    400406

CBOT SOY OIL            JUL8       31.48     -0.03      31.44    31.63     5128

INDIA PALM OIL           MAY8    668.40    -2.70     668.00   671.7     499

INDIA SOYOIL             JUN8      778.3      -6.25      777.3      786     18200

NYMEX CRUDE           JUL8       71.74      -0.46     71.68    72.26    124301

Palm oil prices in Malaysian ringgit per tonne

CBOT soy oil in US cents per pound

Dalian soy oil and RBD palm olein in Chinese yuan per tonne

India soy oil in Indian rupee per 10 kg

Crude in US dollars per barrel

(US$1 = RM3.9800)

(US$1 = 68.3925 Indian rupees)

(US$1 = 6.3865 Chinese yuan)

Read more at http://www.theedgemarkets.com/article/palm-declines-weaker-crude-oil-profittaking