VEGOILS - Palm oil drops more than 3%, as crude and rival oils slump

Malaysian palm futures dropped more than 3% on Monday, following declines in rival edible oils traded in Dalian, Chicago and Dalian markets, as well as crude oil. This was a day after they had posted their largest jump in three-years.

The benchmark May palm oil contract on Bursa Malaysia's Derivatives exchange fell 139 ringgit or 3.04% to $4,428 ringgit (1,129.59 USD) per metric ton after earlier falling to 4,370 ringgit.

A Kuala Lumpur-based broker said that the futures track external Dalian palm oil and Chicago soy oil performances, as well as crude oil.

MPOB data shows that Malaysia's palm oil stocks dropped 3.9% from the previous months to a 4-month low of 2.70 million metric tonnes.

Palm oil exports dropped 22.5%, or 1.13 million tonnes, to 1,28 million tons. Crude palm oil production fell 18.6% to 1.28 millions tons in January.

Dalian's palm oil contract, which is the most active contract, fell by 1.29%. Chicago Board of Trade Soyoil declined by 0.68%.

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

Crude oil prices fell 7% on Tuesday, after reaching a three-year high in the previous session. U.S. president Donald Trump had predicted that the Middle East war would end soon. This eased concerns over prolonged disruptions of oil supplies.

Palm oil is less appealing as a biodiesel feedstock due to lower crude oil futures.

AmSpec Agri Malaysia, an independent inspection company, reported that exports of Malaysian palm oil products rose 45.3% from February 1-10. Intertek Testing Services said it was up 37.9%. $1 = 3.9200 Ringgit (Reporting and editing by Harikrishnan Nair).

(source: Reuters)