Malaysian palm oil price retreats over 1% on weak CBOT soyoil
30.01.2019 (The Star Online) - KUALA LUMPUR: Malaysian palm oil futures fell over 1 percent on Tuesday, retreating from the previous session's sharp gains on weakness in Chicago soyoil and overnight crude oil.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange opened steady at 2,327 ringgit and was down 1.2 percent at 2,300 ringgit ($559.47) a tonne by the midday break.
Trading volumes stood at 16,225 lots of 25 tonnes each.
Palm oil futures rose for a sixth session in seven on Monday and hit their highest in nearly seven months, tracking strength in related edible oils.
"Market is overbought, so the fall is not a surprise," said a Kuala Lumpur-based trader.
Prices of soyoil on the Chicago Board of Trade fell for a second straight session on Tuesday with concerns over escalating U.S.-China trade tensions and improved weather in Brazil weighing on the market.
The Chicago March soybean oil contract was down 0.6 percent.
"There is a lack of new catalyst and the market is also factoring in weaker gains in the crude oil market overnight," said another futures trader from Kuala Lumpur.
Positive export data from a cargo surveyor failed to buoy sentiment as the market had already factored it in, said the trader.
Exports of Malaysian palm oil products for Jan. 1-25 rose 12 percent to 1,207,619 tonnes from 1,078,274 tonnes shipped a month earlier, cargo surveyor Societe Generale de Surveillance said on Tuesday.
Palm oil still targets 2,351 ringgit per tonne as it has stabilised above a former resistance at 2,322 ringgit, Wang Tao, a Reuters market analyst for commodities and energy technicals, said.
In other related oils, the May soybean oil contract on the Dalian Commodity Exchange was up 0.3 percent, while the Dalian May palm oil contract was unchanged.
Palm oil prices are affected by movements in soyoil rates, as they compete for a share in the global vegetable oil market.
Malaysian markets will be closed on Feb. 5-6 for the Lunar New Year celebrations. - Reuters