Palm oil is set to drop for the first time in five weeks, as it follows weak competitors lower.

Malaysian palm oils futures fell for the second consecutive session on Friday. They are on track to record their first weekly decline in five weeks.

By midday, the benchmark April palm oil contract on Bursa Derivatives Exchange had lost 15 ringgit or 0.36%. It was trading at?4,191 Ringgit ($1,061.01) per metric ton. The contract has lost 0.9% in the past week.

A Kuala Lumpur based trader stated that "Bursa crude palm oil futures follow weaker external market conditions but weaker Ringgit cushion some losses."

Dalian's soyoil most active contract fell 0.27% while its palm oil contract dropped 0.64%. Prices of soyoil on the Chicago Board of Trade fell by 0.16%.

As palm oil competes to gain a share in the global vegetable oils market, it tracks the price changes of its rival edible oils.

The Malaysian Ringgit, which is the currency used in the trade contract, fell 0.13% to the U.S. Dollar on Friday, making it more attractive to foreign currency holders.

A survey shows that Malaysia's palm oil inventories will end their 10-month streak of rising stocks in January as exports surged during a slowdown in production due to the season.

Technical analyst Wang Tao said that palm oil could retest the support level of 4,169 ringgits per metric tonne. A break below this mark would open the door to the range 4,116-4148 ringgits.

(source: Reuters)