KUALA LUMPUR (June 7): Malaysian palm oil futures continued to trade lower after reversing gains during the first half session on Friday, as a stronger ringgit deterred and traders reduced market exposure ahead of industry news.
Benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was 0.3% lower at RM2,050 (US$493.26) per tonne at the midday break.
"The market opened higher, tracking the crude oil rally, but ringgit strength has dampened sentiment," said a Kuala Lumpur-based trader.
Strength in the ringgit, which is up 0.4% against the US dollar, makes palm less attractive for traders holding foreign currencies.
Traders are also squaring their positions ahead of a stockpiles report next week, which could have weighed on the market, the trader added. Traders expect palm to trade range-bound on Friday.
In related oils, the US Chicago Board of Trade soyoil was marginally down 0.04%.
The Dalian Commodity Exchange was closed on Friday for the Dragon Boat Festival.
Palm oil prices are affected by movements in soyoil, with which it competes for global market share.
Palm, soy and crude oil prices at 0455 GMT
|MY PALM OIL||JUN9||2020||-10.00||2020||2025||41|
|MY PALM OIL||JUL9||2038||-7.00||2031||2060||1002|
|MY PALM OIL||AUG9||2050||-6.00||2042||2075||7563|
|CHINA PALM OLEIN||SEP9||0||+0.00||0||0||0|
|CBOT SOY OIL||JUL9||27.75||-0.01||27.73||27.85||2917|
|INDIA PALM OIL||JUN9||511.60||+0.00||510.10||512.4||61|
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 = RM4.1560)
(US$1 = 69.2525 Indian rupees)
(US$1 = 6.9057 Chinese yuan)