JAKARTA: Malaysian palm oil futures declined slightly on Wednesday, tracking their Dalian counterparts that pared some of their earlier gains.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange fell 3 ringgit, or 0.07%, to 4,156 ringgit ($1,008.49) a metric ton at closing.
“Today’s crude palm oil future is still range bound tracking Dalian as Dalian also drop slightly,” a Kuala Lumpur-based trader said.
Dalian’s palm oil contract gained 0.95% after rising 1.69% earlier in the session while its most-active soyoil contract was barely changed, up 0.07%. Soyoil prices on the Chicago Board of Trade lost 0.66%.
Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.
Malaysia’s palm oil inventories likely rose to a more than six-and-a-half-year high in November, as exports slumped amid record production for the month, a Reuters survey showed on Wednesday.
Malaysia’s Federal Land Development Authority (Felda) and its commercial arm FGV Holdings Berhad said they had been issued an order by Terengganu state to vacate palm oil plantation land there, warning it could impact operations and national output.
Meanwhile, India’s palm oil imports rose slightly in November as lower prices prompted refiners to increase purchases of the tropical oil while cutting back on more expensive soyoil and sunflower oil purchases.
Malaysian ringgit, the contract’s currency of trade, strengthened 0.22% against the U.S. dollar, making palm oil more expensive for foreign currency holders.
Palm oil may test resistance at 4,202 ringgit per ton, a break above which would open the way towards 4,274 ringgit, per Reuters technical analyst Wang Tao.
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