Crude Palm Oil Falls 3.6%; DCE, CBOT Also Hit By Profit-Taking - Palm OilHQ

Crude palm oil futures on Malaysia’s derivatives exchange ended lower Wednesday as profit taking and sharp losses hit Chicago soyoil and Chinese commodities.

The new benchmark May contract on the Bursa Malaysia Derivatives ended down MYR140, or 3.6%, at MYR3,745 a metric ton after moving in a range of MYR3,741-MYR3,822. The market was closed for a public holiday on Tuesday.

Investors shrugged off price-friendly export figures due to improved South American soybean crop prospects. Fears that sharp recent increases in global vegetable oil prices may constrain future demand exacerbated the fall in palm oil prices.

Malaysia’s outbound sales of palm oil during the Feb. 1-15 period rose 7.3% from a month earlier to 610,087 tons, according to cargo surveyor SGS (Malaysia) Bhd. Another surveyor, Intertek Agri Services, Tuesday pegged exports at 636,966 tons, compared with 589,010 tons during the Jan. 1-15 period.

Palm oil’s decline to its lowest level since Dec. 17 followed losses overnight in soybean and soyoil prices on the Chicago Board of Trade, as traders cut risky positions following higher soybean crop estimates for Brazil and rains in Argentina diminished the threat of prolonged tightness in supplies.

Soybean, palm oil and soyoil futures on the Dalian Commodity Exchange ended lower Wednesday, after soyoil futures on the Chicago Board of Trade fell 115 points or 2% to 56.64 cents a pound overnight, and recovered only marginally in screen trade.

The most-active rupiah-denominated April CPO contract on the Indonesia Commodity & Derivatives Exchange was trading 3.1% lower at IDR11,015 a ton at 0945 GMT.

CME Group’s dollar-denominated palm oil contract for May delivery was $25.75 lower at $1,235/ton.

In the cash market, palm olein for April, May and June delivery traded at $1,270/ton, and shipments for July, August, September at $1,222.50 and $1,220/ton, free on board Malaysian ports, a Singapore-based physical market broker said.

Open interest on the BMD was 101,210 lots, versus 101,509 lots Monday. One lot is equivalent to 25 tons.

A total of 26,026 lots of CPO were traded versus 23,805 lots Monday.