KUALA LUMPUR: Malaysian palm oil futures declined on Thursday, as profit taking and the weakness in the Chicago soyoil contract weighed down the market.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange fell 14 ringgit, or 0.33%, to 4,182 ringgit ($991.47) a metric ton at the close.
Malaysian palm oil futures declined due to profit taking activities after the recent gains in the previous session, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.
“The decline is also influenced by the overnight weakness in the Chicago soyoil market.”
Soyoil prices on the Chicago Board of Trade fell 0.16%. Dalian’s vegetable oil markets were closed for China’s Golden Week holiday.
Palm oil tracks prices of rival edible oils as they compete for a share of the global vegetable oils market.
Palm rises on stronger crude oil, Chicago soyoil and weaker ringgit
Oil prices rose on Thursday as the prospect of a widening Middle East conflict that could disrupt crude oil flows from the region overshadowed a stronger global supply outlook.
Brent crude futures for December were up 1.85% at $75.27 a barrel as of 1013 GMT. Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, weakened 1.2% against the U.S. dollar, making the commodity cheaper for buyers holding foreign currencies.
The European Commission said it would propose delaying the implementation of a law banning the import of commodities linked to deforestation by a year, following calls from industries and governments around the world.
American Dollar Exchange Rate