JAKARTA: Malaysian palm oil futures eased on Thursday, snapping a three-session rally as weaker rival vegetable oils on the Dalian and Chicago markets weighed on prices, while traders awaited export data for fresh demand cues.
The benchmark December palm oil contract on the Bursa Malaysia Derivatives Exchange was down 34 ringgit, or 0.72%, at 4,666 ringgit ($1,143.63) a metric ton at the midday break.
The FCPO, the crude palm oil futures contract, is tracking weakness from Dalian market as well as Chicago soyoil pricing while waiting for export data, a Kuala Lumpur-based trader said. Dalian’s most-active soyoil contract fell 1.66%, while its palm oil contract slipped 2.15%.
Soyoil prices on the Chicago Board of Trade were down 0.64%. Palm oil tracks rival edible oils, as it competes for a share of the global vegetable oils market.
Oil prices fell more than 1% on Thursday as investors weighed risks to supply from attacks on shipping through the Strait of Hormuz against US efforts to cut petroleum shipping costs by easing sanctions on vessels.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Malaysia lowered its November crude palm oil reference price, keeping the export duty at 10%, a circular on the Malaysian Palm Oil Board website showed on Wednesday.
The ringgit, palm’s currency of trade, strengthened 0.02% against the dollar, making the commodity slightly more expensive for buyers holding foreign currencies.
Palm oil may test a support at 4,622 ringgit per ton, a break below which could open the way toward the 4,567-4,588 ringgit range, Reuters technical analyst Wang Tao said.