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Vegoils: Palm oil hits two-year low on weaker Dalian oils, stronger ringgit

Reuters  |  KUALA LUMPUR 

By Emily Chow

(Reuters) - Malaysian palm futures fell more than 1 percent to a two-year low on Tuesday, hurt by weaker oils on China's Commodity Exchange and a firmer ringgit.

The ringgit rose to its strongest levels against the dollar in two weeks on Tuesday, and was up 0.1 percent at 4.0200 per dollar at 1040 GMT. A stronger ringgit, palm's traded currency, makes the more expensive for foreign buyers.

The benchmark palm contract for September delivery on the Bursa was down 0.4 percent at 2,259 ringgit ($561.94) a tonne at the close of trade.

It earlier fell as much as 1.5 percent to 2,234 ringgit, its lowest since July 15, 2016.

Trading volumes stood at 63,851 lots of 25 tonnes each on Tuesday evening.

"The ringgit strengthening, a weak and poor exports are all factors for palm's decline today, though it is mainly on Dalian's weakness," said a based

"As better production is expected, slow exports due to low pricing are causing importers to buy on 'need only basis', there is no rush to buy."

June production fell 12.6 percent to 1.33 million tonnes versus the previous month, according to data from industry regulator the (MPOB) on Tuesday. Output is expected to rise in July and throughout the third quarter of the year, in line with seasonal trends.

The MPOB data also showed end-stocks in June rose 0.8 percent from the previous month to 2.19 million tonnes, while exports declined 12.6 percent to 1.13 million tonnes.

Malaysian palm during July 1-10 also fell 14.4 percent from the corresponding period last month, reported inspection company on Tuesday. [PALM/AAM]

Cargo de Surveillance reported a 23.1 percent decline in exports for the same period.

In other related oils, the September soybean on China's Commodity Exchange fell 0.03 percent, while Chicago December declined 1.7 percent.

The Dalian September palm was also down 2.4 percent.

Palm track the performance of other edible oils as they compete for a share in the global vegetable oils market.

Palm oil may fall into a range of 2,238-2,253 ringgit per tonne, said Wang Tao, a

(Reporting by Emily Chow; Editing by and Mark Potter)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Tue, July 10 2018. 16:35 IST