Palm dips on sluggish export data, Indonesia’s lower export tax
Malaysian palm oil futures traded lower on Monday, shedding gains from the previous session, following the release of lacklustre export data and as rival Indonesia set lower palm oil export tax for the second half of October.
The benchmark palm oil contract FCPOc3 for January delivery on the Bursa Malaysia Derivatives Exchange was down 1.84% at 3,795 ringgit ($804.88) per tonne by midday break, after gaining nearly 5% on Friday.
Some market participants were disappointed by the sluggish Malaysian export data for Oct. 1-15 despite weakness in ringgit, which would have made palm oil attractive for foreign buyers, a Kuala Lumpur-based trader said.
Exports of Malaysian palm oil products for Oct. 1-15 fell 4% from the same period in September, cargo surveyor Intertek Testing Services (ITS) said on Saturday, while independent inspection company AmSpec Agri Malaysia reported a 1.9% increase.
Indonesia has set the crude palm oil reference price for Oct. 16-31 at $713.89 per tonne, a Trade Ministry document distributed on Saturday showed, putting export tax at $3 per tonne, down from $33 imposed on the previous reference price.
“The tax incentive from Indonesia will attract buyer,” the trader added.
Dalian’s most-active soyoil contract DBYv1 was down 1.31%, while its palm oil contract DCPcv1 fell 0.05%. Soyoil prices on the Chicago Board of Trade BOc2 erased earlier gains to trade 0.14% lower.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil may retrace towards a support at 3,707 ringgit per tonne, following its failure to break a resistance at 3,858 ringgit.
Source: Reuters (Reporting by Fransiska Nangoy; Editing by Sherry Jacob-Phillips)