Palm falls on firmer ringgit, traders await stockpiles report

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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

Contract         Month   Last  Change     Low   High  Volume
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
CHINA SOYOIL    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
INDIA SOYOIL    JUN9    747.15   -0.40  746.35    750    1260
NYMEX CRUDE     JUL9    53.37   +0.78   52.92  53.38   31647

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)