Yahoo News (05/03/2020) - KUALA LUMPUR, March 5 (Reuters) - Malaysian palm oil futures fell on Thursday, dragged by a stronger ringgit, cargo surveyor data showing a drop in last month's exports, and expectations of higher February production.

The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange declined 15 ringgit, or 0.6%, to 2,480 ringgit ($595.44) in early trade.

Palm oil surged 5% in the previous session as buyers stocked up ahead of the Muslim holy month of Ramadan.

FUNDAMENTALS

* Malaysia's February exports fell between 11.84% and 12.9% from the previous month due to the coronavirus outbreak in the second-largest buyer, China, according to cargo surveyors. However, the market is optimistic that export demand would pick up this month because of Ramadan, traders said.

* Typically demand for palm oil picks up one or two months ahead of Ramadan as importers stock up on the commodity in anticipation of increased demand to prepare food for the festivities. Ramadan is scheduled to start on April 23.

* Analysts expect February production to increase by 4%-12%, according to traders.

* The ringgit, palm's currency of trade, firmed 0.37% against the dollar, making the tropical oil more expensive for holders of foreign currency.

* Dalian's most-active soyoil contract traded 0.88% higher, while its palm oil contract jumped 2.2%. Soyoil prices on the Chicago Board of Trade gained 0.13%.

* Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

* Palm oil may test a resistance at 2,520 ringgit per tonne, a break above which could lead to a gain into the range of 2,592-2,663 ringgit, Reuters technical analyst Wang Tao said.

MARKET NEWS

* Asian shares were looking to rally for a fourth straight session as U.S. markets swung sharply higher and another dose of central bank stimulus offered some salve for the global economic outlook.

DATA/EVENTS

0030 Australia Trade Balance G&S Jan

1330 US Initial Jobless Claims Weekly

1500 US Factory Orders MM Jan

($1 = 4.1650 ringgit) (Reporting by Mei Mei Chu; Editing by Subhranshu Sahu)

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