VEGOILS - Palm falls for the third time in a row on weak demand and currency strengthening

Malaysian palm futures declined for three sessions in a row on Monday. The contract closed at its lowest level in 21 weeks as the stronger ringgit weighed on it, and weak demand also contributed to this decline.

The benchmark palm-oil contract for February delivery at the Bursa Derivatives Exchange in Malaysia lost 14 ringgit or 0.34% to 4,055 Ringgit ($979.71), its lowest closing price since July 1.

Paramalingam Supramaniam of Selangor's brokerage Pelindung Bestari said that the contract ended lower because the ringgit was stronger, and export demand was low due to large stocks at October's end.

According to AmSpec Agri, an independent inspection company and Intertek Testing Services, cargo surveyor and independent inspection company, exports of Malaysian products containing palm oil fell between 14.1% and 20% from November 1-20.

Production was expected to drop slowly from December through the first quarter 2026.

Supramaniam stated that "it is definitely delayed, but the impact of monsoon rains will become more apparent very soon once the major producing states begin to receive more rainfall."

The National Disaster Agency said that more than 11,000 people have been affected in seven Malaysian states by floods caused by torrential rainfall.

Dalian's palm oil contract, which is the most active contract, fell by 1.18%. Chicago Board of Trade soyoil prices were up by 0.32%.

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

The palm ringgit's trade currency strengthened by 0.17% against dollars, increasing the price of the commodity for buyers who hold foreign currencies.

Wang Tao, a technical analyst, believes that palm oil prices could fall to a range between 3,991 and 4,034 ringgits per ton. This is due to a (5) wave. $1 = 4.1390 Ringgit (Reporting and editing by Subhranshu Sahu, Krishna Chandra Eluri).

(source: Reuters)