Palm oil continues to lose money on the weaker crude and rival edible oils

Malaysian palm oil futures extended their losses for a third consecutive day on Thursday. This was due to the decline in oil prices and rival vegetable oils, as well as export data.

At the close, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange was down 75 Ringgit or 1.62% to 4,558 Ringgit ($1,107.65 per metric tonne). Dalian's most active?soyoil contracts dropped 0.37%, while its palm oil contracts declined 1.81%. Chicago Board of Trade Soyoil Prices fell by 0.38%.

Palm oil follows the price movement of other edible oils as it competes to gain a share in the global vegetable oils markets. According to AmSpec Agri Malaysia an independent inspection company, exports of 'Malaysian Palm Oil Products' for the period June 1-25 rose by 11.1%. Intertek Testing Services, a cargo surveyor, reported a 10.6% increase. Oil prices dropped on Thursday, reaching levels not seen since 'before the Iran war' as the expectation of increased supply from the Middle East overshadowed 'demand concerns.

Palm prices are also influenced by crude oil futures, with lower crude oil prices making palm less appealing as a biodiesel source. Indonesia has released a regulation that will implement its B50 biodiesel requirement starting July 1. Retailers have a 3-month transition period to get rid of their existing stocks.

(source: Reuters)