April 23, 2018 / 11:14 AM / a year ago

Vegoils: Palm oil dips on weaker demand and U.S. soyoil losses

KUALA LUMPUR (Reuters) - Malaysian palm oil futures declined on Monday evening, charting a second session of decline in three, as the market was pulled down by weaker demand and overnight losses in U.S. soyoil.

FILE PHOTO: A worker collects palm oil fruit inside a palm oil factory in Sepang, outside Kuala Lumpur, Malaysia February 18, 2014. REUTERS/Samsul Said/File Photo

The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange fell 0.3 percent to 2,408 ringgit ($617.99) a tonne at the end of the trading day.

Trading volumes stood at 22,803 lots of 25 tonnes each at the close.

“The market is reacting towards a weaker exports pace,” said a futures trader in Kuala Lumpur, referring to Malaysia palm oil shipment data released last week.

Malaysia’s palm oil exports rose 2 percent month on month for April 1-20, according to inspection company AmSpec Agri Malaysia.

Cargo surveyor Societe Generale de Surveillance, meanwhile, pegged the period’s exports decline at 1.8 percent.

The export figures showed overall slowing demand growth from a month ago, when shipments for the full month of March were up 19.4 percent and 21.6 percent, according to SGS and AmSpec respectively.

Another futures trader said palm oil was still trading in a tight range, though overnight soyoil losses on the Chicago Board of Trade weighed on the market on Monday.

Palm oil is affected by movements in rival edible oils that compete for a share in the global vegetable oils market.

Chicago’s July soybean oil contract was down 0.3 percent on Friday, but was last up 0.1 percent on Monday.

In other oils, September soybean oil on China’s Dalian Commodity Exchange was down 0.03 percent while the Dalian September palm oil contract dipped 0.1 percent.

Palm oil could retest a resistance at 2,434 ringgit a tonne, a break above which could lead to a gain to the next resistance at 2,476 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

Reporting by Emily Chow; Editing by Tom Hogue and David Goodman

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