Palm falls over 1% on weaker export outlook

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KUALA LUMPUR (Feb 11): Malaysian palm oil futures fell over 1% to their lowest in nearly three weeks on Monday, as traders turned bearish due to a weaker outlook for exports. 

The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange fell 1.1% to 2,266 ringgit (US$556.76) a tonne at the end of the trading day, a second straight day of declines.

It had earlier fallen to 2,264 ringgit, its lowest since Jan 23. 

Trading volumes stood at 35,402 lots of 25 tonnes each at the close of trade.

"The market is down on lower exports and the anticipation that U.S. soyoil will slip lower tonight," said a Kuala Lumpur-based trader. 

Another trader had earlier said that weak external markets, led by the falls in crude and U.S. soyoil, also weighed on palm.

Exports of Malaysian palm oil products for Feb 1-10 fell 11.2%-13% from Jan 1-10, according to independent inspection company AmSpec Agri Malaysia and cargo surveyor Intertek Testing Services.

Malaysian exports rose 21.2% to 1.68 million tonnes in January, according to industry regulator the Malaysian Palm Oil Board, but the strong demand trend is not seen continuing in February.

The MPOB data also showed January stockpiles falling 6.7% from the previous month to 3 million tonnes, while production fell 3.9% to 1.74 million tonnes. 

In other related oils, the Chicago March soybean oil contract fell 1%, while the May contract on the Dalian Commodity Exchange rose 0.4%.

The Dalian January palm oil contract, meanwhile, was trading flat around 1105 GMT.

Palm oil prices are affected by movements in soyoil rates, as they compete for a share in the global vegetable oil market. 

Palm oil may fall into a range of 2,256-2,274 ringgit per tonne, as its uptrend from the Nov 27 2018 low of 1,940 ringgit has reversed, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
    
 Palm, soy and crude oil prices at 1105 GMT:

Contract Month Last Change Low High Volume
MY PALM OIL FEB9 2202 +5.00 2200 2230 341
MY PALM OIL MAR9 2227 -28.00 2226 2253 4245
MY PALM OIL APR9 2265 -24.00 2264 2290 13470
CHINA PALM OLEIN MAY9 4772 +0.00 4762 4828 215478
CHINA SOYOIL MAY9 5746 +20.00 5722 5804 262112
CBOT SOY OIL MAR9 30.56 -0.31 30.5 30.87 7973
INDIA PALM OIL FEB9 564.90 -5.60 564.50 570.7 521
INDIA SOYOIL FEB9 774 -0.90 772.5 777.4 6330
NYMEX CRUDE MAR9 52.25 -0.47 51.82 52.78 148729

 Palm oil prices in Malaysian ringgit per tonne
 CBOT soy oil in U.S. cents per pound
 Dalian soy oil and RBD palm olein in Chinese yuan per tonne
 India soy oil in Indian rupee per 10 kg
 Crude in U.S. dollars per barrel
 
(US$1 = 4.0700 ringgit)
(US$1 = 71.2410 Indian rupees)
(US$1 = 6.7762 Chinese yuan)