in four months yesterday, as a drop in the crude oil price dragged down
other vegetable oil markets as well, traders said.
US crude oil
rebounded to above US$70 a barrel yesterday, after hitting its lowest
in more than three months, extending a loss of nearly 18 per cent so far
in May on concerns over Europe’s debts, the weak euro, and swollen US
oil inventories.
“The market will consolidate at RM2,400-2,500
in the next few days unless there’s a major catastrophe, such as falling
crude oil and strengthening US dollar,” said one trader in Kuala
Lumpur.
Palm tends to track energy prices because of its use in biodiesel, which
competes with fossil-based fuels.
“We’ve seen bargain-hunting
coming in, while the support level is likely at RM2,400,” said another
trader in Kuala Lumpur.
The benchmark August crude palm oil
futures on Bursa Malaysia Derivatives Exchange fell 0.9 per cent, or
RM22, to RM2,425 a tonne, its lowest since January 26.
Traded
volume reached 14,915 lots of 25 tonnes each, more than the midday
average of 10,000 lots. Other palm oil contracts fell between 0.81 per
cent to 1.15 per cent.
Exports of Malaysian palm oil products for
May 1-15 jumped 23.1 per cent to 591,887 tonnes, from 480,966 tonnes
shipped between April 1 to 15, cargo surveyor Intertek Testing Services
said on Saturday.
Another cargo surveyor Societe Generale de
Surveillance said yesterday that exports of Malaysian palm oil products
for May 1-15 jumped 23.6 per cent to 620,517 tonnes, in line with the
market’s expectations.
“Exports are quite encouraging this month
and hopefully it will last when demand for the fasting month (Ramadan)
starts soon, and prevent stocks from building up to above 2 million,”
said the second trader.
Crude oil had also dragged on China’s
soyoil market and expectations of record high soybean imports has kept
traders away.
Source : Business Times
