Palm edges down on firmer ringgit, weaker related oils

-A +A

KUALA LUMPUR (Aug 21): Malaysian palm oil futures edged lower on Tuesday after three straight sessions of gains, dragged by a stronger ringgit and weaker related edible oils.

The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange was down 0.4% at RM2,247 (US$547.38) a tonne at the midday break.

Trading volumes stood at 17,284 lots of 25 tonnes each at noon.

"The market is lower tracking weaker soyoil and as the ringgit is firmer," said a futures trader in Kuala Lumpur.

The ringgit was last up 0.2% at 4.0920 per dollar. Gains in the ringgit, the currency of trade for palm oil, typically make the vegetable oil more expensive for foreign buyers, thus limiting demand.

Uncertainties surrounding the trade talks between China and the United States have contributed to the bearish trading sentiment in the palm market, said another trader.   

In other related oils, the Chicago December soybean oil contract was down 0.2%, while the January soybean oil contract on China's Dalian Commodity Exchange declined 0.4%.

Meanwhile, the Dalian January palm oil contract edged down 0.7%.

Palm oil prices are impacted by movements of other edible oils, as they compete for a share in the global vegetable oils market.

Palm oil still targets a range of RM2,269-2,277 per tonne as it has cleared a resistance at RM2,240, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

Palm, soy and crude oil prices at 0530 GMT

Contract         Month    Last   Change     Low   High  Volume
MY PALM OIL     SEP8      2205   -10.00    2203   2207     139
MY PALM OIL     OCT8      2226   -10.00    2222   2230    3532
MY PALM OIL     NOV8      2247    -8.00    2242   2251    6503
CHINA PALM OLEIN      JAN9      4916   -30.00    4906   4956  154490
CHINA SOYOIL    JAN9      5864   -24.00    5848   5890  218624
CBOT SOY OIL    DEC8     28.81    -2.50   28.61  28.86    1972
INDIA PALM OIL  AUG8    601.50    -2.50  601.50  602.8     134
INDIA SOYOIL    SEP8     740.5    -2.15     740  742.4    1550
NYMEX CRUDE     SEP8     66.67    +0.24   66.53  66.76     107

Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in US cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
India soy oil in Indian rupee per 10 kg
Crude in US dollars per barrel

(US$1 = RM4.1050)
(US$1 = 70.0900 Indian rupees)
(US$1 = 6.8740 Chinese yuan)