Palm oil prices fall due to profit-taking and weak demand
Malaysian palm futures declined?on Tuesday after a two session rally. Profit-taking and weak demand for exports were the main reasons.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange fell 13 ringgit or 0.26% to 4,960 Ringgit ($1,226.61) a metric tonne at the close.
Paramalingam Supramaniam is the director of brokerage Pelindung Bestari. He said that profit-taking was prevalent on the market, and demand for palm remains low.
Exports of palm oil-based products from Malaysia fell between 6.5% to 14.9% in August compared with a month ago, according to cargo surveyors.
The current palm prices are not likely to be favorable for India. The Malaysian Palm Oil Association data will also help traders get a better idea of the production patterns for August, and whether the hot and dry conditions have negatively affected production.
Dalian's palm oil contract, which is the most active contract in Dalian, fell 1.04%. Chicago Board of Trade soyoil prices were down 0.34%.
As palm oil competes to gain a share in the global vegetable oils market, it tracks the price fluctuations of competing edible oils.
The oil price was little changed after it climbed?to higher levels than one month earlier. Traders were weighing the risks of disruptions in supply?following the overnight U.S.-Iranian strikes against signs that crude supplies continued to reach the market.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
The palm?ringgit?, the currency of trade for the company, fell 0.17% in value against the dollar. This made the product slightly cheaper to buyers who held foreign currencies.
(source: Reuters)
