JAKARTA: Malaysian palm oil futures tumbled on Tuesday after closing at their highest since mid-June 2022 in the previous session, trailing weakness in soyoil prices.
The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange lost 165 ringgit, or 3.18%, its biggest daily drop since Aug. 5, to 5,031 ringgit ($1,134.64) a metric ton at closing, snapping a four-session rally.
“Prices went up too much already, normal to head lower. We are too expensive compared to other edible oils,” said a Kuala Lumpur-based trader, adding that fundamentals are not supportive of the price.
Exports of Malaysia’s palm oil products in the Nov. 1-10 period declined between 14.6% and 15.8% compared to the same period a month ago, according to surveyors AmSpec Agri Malaysia and Intertek Testing Services (ITS).
Palm oil closed highest since mid June 2022
Malaysia’s palm oil stocks shrank the most in seven months in October as exports surged, production fell and domestic consumption increased, the country’s industry regulator said on Monday.
Weaker soyoil prices also added pressure to the contract, the trader said.
Dalian’s most-active soyoil contract fell 2.7%, while its palm oil contract barely changed, down 0.49%. Soyoil prices on the Chicago Board of Trade were down 2.76%.
Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
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