Palm oil drops nearly 1 percent on bleak exports
KUALA LUMPUR: Malaysian palm oil futures slid nearly 1 percent on Wednesday, falling further from a three-week high reached at the start of the week, after data showed a drop in exports this month.
Palm oil prices have come under pressure in the absence of an expected pick up in imports by key consumer China ahead of Lunar New Year celebrations in February. A slowdown in growth in the world’s No.2 economy and ample world supplies of rival soyoil have curbed the country’s demand for the tropical oil.
The palm oil contract for April on the Bursa Malaysia Derivatives Exchange fell 0.9 percent to close at 2,455 ringgit ($559.10) per tonne, below Monday’s near three-week top of 2,495 ringgit. Traded volume stood at 39,984 lots of 25 tonnes each. “The market fall has quite a lot to do with the export data,” said a Kuala Lumpur-based trader.
Data from cargo surveyor Intertek Testing Services (ITS) shows an 8.5 percent month-on-month drop in Malaysian palm oil exports over Jan. 1-20, while Societe Generale de Surveillance reported a 10.5 percent drop in shipments.