Malaysian palm oil futures dropped on Thursday, snapping four consecutive session of gains, as weakness in Chicago soyoil weighed, while strong export data limited losses.
The benchmark palm oil contract FCPO1! for July delivery on the Bursa Malaysia Derivatives Exchange lost 61 ringgit, or 1.55%, to 3,862 ringgit ($902.34)a metric ton at closing.
Exports of Malaysian palm oil products for May 1 - 15 rose 14.2% to 514,713 tonnes from 450,657 tonnes shipped during April 1 - 15, independent inspection company AmSpec Agri Malaysia said on Thursday.
"The positive export figures do provides support but Chicago soyoil dropped 270 points, thus our CPO futures is weighed down by it," a Kuala Lumpur-based trader said.
Soyoil prices on the Chicago Board of Trade (CBOT) (BOc2) plunged 5.72%, their steepest daily drop in nearly two years as falling crude oil prices and mounting uncertainty over the U.S. biofuel policy pressured the market.
Dalian's most active soyoil contract (DBYcv1) dropped 0.80%, while its palm oil contract for June delivery CPO1! lost 0.74%.
Palm oil tracks the prices of rival edible oils as it competes for a share of the global vegetable oils market.
Starting May 17, Indonesia will raise its crude palm oil (CPO) export levy to 10% of its CPO reference price from the current 7.5% to finance the country's increased biodiesel blending mandate.
India's vegetable oil imports plunged to their lowest in more than four years in April, led by declines in palm oil imports, dragging inventories to their lowest in nearly five years, a leading industry body said.
The Rosario grains exchange raised its estimate for Argentina's 2024-25 soybean production to 48.5 million metric tons from 45.5 million tons earlier.
Malaysian ringgit USDMYR, the palm's currency of trade, rose for a second session on Thursday, strengthening 0.05% against the U.S. dollar, making the contract more expensive for foreign currency holders.
Palm oil FCPOc3 may retest support at 3,921 ringgit per metric ton, a break below which could trigger a fall into the 3,871-3,887-ringgit range.
Source: Reuters