Palmetto falls due to profit-taking but still posts third consecutive weekly gain

Malaysian palm-oil futures fell 'on Friday due to profit-taking, and the strength of the ringgit, but they still posted a third consecutive weekly gain.

The benchmark contract for palm oil delivery in April on Bursa Derivatives Exchange fell 23 ringgit (0.55%) to $4174 ringgit ($1,042.72) per metric ton. The contract increased 2.5% in the last week.

A Kuala Lumpur based trader said that investors booked profits before the weekend, and a stronger ringgit halted the recent rally.

The ringgit (palm's trade currency) strengthened by 0.87% against the dollar. This made the commodity more costly for buyers who hold foreign currencies.

Dalian's soyoil contract with the highest volume rose by 0.07% while palm oil contracts fell by 0.04%. The Chicago Board of Trade saw a 0.56% increase in soyoil.

As it competes to gain a share of the global vegetable oil market, palm oil monitors price changes of competing edible oils.

After President Donald Trump renewed his threats against Iran, a major Middle Eastern producer, oil prices rose. This was due to fears of military action which could disrupt supply.

Palm oil is a better option as a biodiesel source because crude oil futures are stronger. ($1 = 4.0030 ringgit)

(source: Reuters)