Palm slips on profit-taking, but gains for fourth straight week
Malaysian palm oil futures fell on Friday as traders locked in profits a day after the contract rose to an all-time high on concerns over labour shortages, but logged gains for a fourth straight week.
The benchmark palm oil contract FCPOc3 for March delivery on the Bursa Malaysia Derivatives Exchange ended down 34 ringgit, or 0.66%, at 5,127 ringgit ($1,227.44) a tonne, while advancing 2.68% for the week.
The market is on a profit-taking mode after Thursday’s rally, and tracking Dalian and soyoil weakness, a Kuala Lumpur-based trader said.
Rival oils on Dalian were down for most of the session, hitting sentiment on palm, but turned positive at the end. Dalian’s soyoil contract DBYv1 rose 0.5%, while its palm oil contract DCPv1 gained 0.82%.
Soyoil prices on the Chicago Board of Trade BOc2 were down 0.5%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Adverse news on India imports and palm biofuels could also weigh on sentiment in the coming sessions, the trader added.
India’s edible oil imports in 2022 are expected to fall by 2% as the country boosts domestic production, with palm oil seen taking the biggest hit while soy and sunflower oil imports rise, the Malaysian Palm Oil Council (MPOC) said on Thursday at an industry conference.
At the same conference, the Malaysian Biodiesel Association urged industry officials to come to terms with a steady decline in imports of palm-based biofuels in the European Union following its decarbonisation agenda, with Malaysia’s exports in 2022 seen at their lowest level in five years.
Palm oil may test a support at 5,094 ringgit per tonne, and a break below could open the way to 5,001 ringgit, Reuters technical analyst Wang Tao said. TECH/C
Source: Reuters (Reporting by Liz Lee; Editing by Shounak Dasgupta and Vinay Dwivedi)