KUALA LUMPUR (Dec 8): Malaysian palm oil futures fell for a fifth consecutive day on Friday evening, hitting a fresh five-month low as the market was weighed down by concerns over high stockpiles in the country.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange fell 0.9% to 2,479 ringgit a tonne at the close of trade. It earlier fell to an intraday low of 2,477 ringgit, its weakest level since July 4.
The contract is also down 4.8% for the week, its sixth weekly fall and sharpest weekly decline since February.
Trading volumes at the break stood at 39,815 lots of 25 tonnes each on Friday evening.
“The market is concerned about high stocks, and I heard all the storage tanks are full,” said a futures trader from Kuala Lumpur, adding that despite some buying activity in the market prices remained low on bearish outlooks.
Palm oil inventory levels in Malaysia, the world’s second-largest producer after Indonesia, are expected to rise towards the year-end, as export volumes fall faster than output, weighing on prices.
Stockpiles at end-November are seen rising 11.4% to 2.44 million tonnes on the month, according to a Reuters poll, while output is pegged to drop 3% to 1.95 million tonnes.
Exports are forecast to fall 6% in November to 1.45 million tonnes from October.
Official data from the Malaysian Palm Oil Board is scheduled for release on Dec 12.
Palm oil prices are affected by other edible oils, as they compete for a share in the global vegetable oils market.
The January soybean oil contract on the Chicago Board of Trade was down 0.2%, while the January soybean oil contract on the Dalian Commodity Exchange fell 1%.
In other related oils, the Dalian January palm olein contract dipped 0.1%.
Palm, soy and crude oil prices at 1108 GMT
Contract Month Last Change Low High Volume
MY PALM OIL DEC7 2386 -31.00 2386 2435 120
MY PALM OIL JAN8 2445 -31.00 2440 2493 1795
MY PALM OIL FEB8 2477 -23.00 2477 2523 15559
CHINA PALM OLEIN MAY8 5336 +0.00 5294 5352 242242
CHINA SOYOIL MAY8 5872 -52.00 5860 5902 242682
CBOT SOY OIL JAN8 33.27 -0.09 33.18 33.29 6710
INDIA PALM OIL DEC7 562.90 -5.50 560.10 572.3 823
INDIA SOYOIL DEC7 713 -2.15 711.15 716.9 9790
NYMEX CRUDE JAN8 57.02 +0.33 56.54 57.16 86686
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
India soy oil in Indian rupee per 10 kg
Crude in U.S. dollars per barrel