NEW DELHI (Reuters) - Malaysian palm oil futures extended losses for a fourth consecutive session on Thursday, hitting their lowest in one month on continued concerns about a weak demand outlook, while declines in Chicago soybeans also weighed on the market.
The palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was down 0.25 percent at 2,388 ringgit ($600.75) a tonne by the close.
Trading volume stood at 40,305 lots of 25 tonnes.
“Basically weak demand is causing prices to retreat,” said a Kuala Lumpur-based palm oil trader.
Buying for Ramadan has fizzled out as most buyers have already stocked up with the vegetable oil.
The Muslim holy month of Ramadan, which began in mid-May this year, is marked by communal fasting and feasting that boosts consumption of vegetable oils, including palm and soy, in the Middle East and across South and Southeast Asia.
“A weaker external market is also influencing Malaysian palm oil prices,” said another Kuala Lumpur-based trader.
On Thursday, the most active soybean futures on the Chicago Board of Trade were marginally lower at $9.94 a bushel, after hitting their weakest since April 4 at $9.92 a bushel, as uncertainty about U.S. trade relations with China, the world’s top soybean importer, weighed on the market.
China would start auctions of soybeans from its state reserves starting June 14, the National Grain Trade Centre said.
Palm oil is influenced by movements in rival edible oils and oilseeds as they compete for a share in the global vegetable oils market.
Malaysia’s palm oil exports in May dropped 8.8 percent from April to around 1.2 million tonnes, independent inspection company AmSpec Agri Malaysia said last week.
Cargo surveyor Societe Generale de Surveillance (SGS) said the country’s May palm oil exports fell 9.9 percent from a month ago.
In Indonesia, the world’s top palm oil exporter, shipments of palm and palm kernel oils plunged 13.6 percent in April, data from the Indonesia Palm Oil Association showed.
Palm oil is still targeting 2,364 ringgit, as it has broken a support at 2,408 ringgit per tonne, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
Reporting by Mayank Bhardwaj, editing by David Evans