VEGOILS-Palm oil tumbles over 2% on lacklustre demand, higher output fears
22/05/2023 (Nasdaq), Kuala Lumpur - Malaysian palm oil futures slipped more than 2% on Monday, surrendering the previous session's gains, as subdued demand, rising production, and losses in rival edible oils weighed on the market.
The benchmark palm oil contract FCPOc3 for August delivery on the Bursa Malaysia Derivatives Exchange slid 78 ringgit, or 2.24%, to 3,403 ringgit ($767.31) a tonne by the midday break, down for a fifth session in six.
"Trading was depressed by the same factors from last week - surging palm production outlook for May though from a low base in April, losses in related soybean oil, resumption of sunflower oil supply from the Black Sea, and a sluggish Malaysia May export outlook, said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Exports of Malaysian palm oil products for May 1-20 rose 1.6% from the earlier corresponding month, cargo surveyor Intertek Testing Services said on Saturday. Another cargo surveyor, Amspec Agri Malaysia, said exports rose 2.9%.
That was slower than a rise of 4%-5.2% in the May 1-15 period, according to cargo surveyor data.
Dalian's most-active soyoil contract DBYcv1 fell 1.9%, while its palm oil contract DCPcv1 eased 1.2%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.9%.
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 support of 3,418 ringgit per tonne, a break below which could open the way towards the 3,344-3,363 ringgit range, Reuters' technical analyst Wang Tao said. TECH/C
Source:Reuters