Palm ends at over 6-month low on biodiesel delay, higher output prospects
16.04.2020 (Business Recorder) –
- The market will be looking at whether Indonesia will also make any changes to its B30 biodiesel mandate, a Kuala Lumpur-based trader said.
- Malaysia's palm oil exports during April 1-15 fell between 3.6pc and 6pc, according to cargo surveyors on Wednesday.
- The Malaysian Southern Peninsular Palm Oil Millers Association estimated April 1-15 production to pick up by 25pc, traders said.
KUALA LUMPUR: Malaysian palm oil futures closed at a more than six-month low on Thursday, hurt by the country's decision to delay its biodiesel mandate, while prospects of higher output and slower exports amid coronavirus-led lockdowns also dented sentiment.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange ended 36 ringgit lower, or 1.6pc, at 2,203 ringgit ($504.12) per tonne, its lowest since Oct. 15, 2019. The contract had climbed as much as 0.44pc during the session.
Malaysia's Commodities Ministry aims to delay adoption of its B20 biodiesel mandate nationwide amid movement curbs to rein in COVID-19, the Malaysian Biodiesel Association said.
The market will be looking at whether Indonesia will also make any changes to its B30 biodiesel mandate, a Kuala Lumpur-based trader said.
Malaysia's palm oil exports during April 1-15 fell between 3.6pc and 6pc, according to cargo surveyors on Wednesday.
“Nearby end-stock will rise fast if exports fall as production is picking up," the trader said.
The Malaysian Southern Peninsular Palm Oil Millers Association estimated April 1-15 production to pick up by 25pc, traders said.
Dalian's most-active soyoil contract gained 0.22pc, while its palm oil contract fell 2.43pc. Soyoil prices on the Chicago Board of Trade were also down 0.22pc.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.