Profit taking by VEGOILS - Palm oil ends lower than rival Chicago soyoil
The price of Malaysian palm oils futures dropped on Tuesday. This ended a three-session streak of gains. It was dragged down both by the decline in soyoil prices in Chicago and profit-taking.
The benchmark palm-oil contract for September delivery at Bursa Malaysia's Derivatives exchange lost 28 ringgit or 0.68% to $4,066 ringgit (US$958.28) per metric ton.
A Kuala Lumpur based trader stated that the futures market is in profit-taking mode following the recent rally. The sentiment was influenced by Dalian and the CBOT Soyoil.
Chicago Board of Trade Soyoil was down by 1.09%. Dalian's soyoil contract with the highest volume was up by 0.58%. Palm oil contracts rose by 1.05%.
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price fluctuations of competing edible oils.
U.S. Biofuel Blending Proposals are likely to increase Demand. Soybean futures reached a month-high before paring their gains.
Analysts said that the uncertainty surrounding the conflict between Israel and Iran would continue to drive up oil prices, even though there are no concrete signs that production will be affected.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
Intertek Testing Services, a cargo surveyor, reported that exports of Malaysian products containing palm oil rose 26.3% from May 1-15. AmSpec Agri Malaysia is an independent inspection company and reports shipments up 17.8%. $1 = 4.2430 Ringgit (Reporting and editing by Harikrishnan Nair; Mrigank Dhaniwala, Vijay Kishore).
(source: Reuters)
