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Palm falls more than 1% on weaker rival oils, crude

By Reuters News

KUALA LUMPUR, Nov 5 (Reuters) - Malaysian palm oil futures fell more than 1% on Thursday to trade close to a 25-week low, pressured by declines in rival edible oils and weaker crude oil prices.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange slid 56 ringgit, or 1.25%, to 4,440 ringgit ($1,093.33) a metric ton in early trade, extending losses for a fourth straight session.

FUNDAMENTALS

  • Oil prices fell for a fourth day on expectations the losses US President Donald Trump's Republican Party suffered in Congressional elections this week may reduce the risk of further escalation of the US-Israeli war on Iran. O/R

  • Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

  • Dalian's most-active soyoil contract fell 0.72%, while its palm oil contract shed 1.34%. Soyoil prices on the Chicago Board of Trade were down 0.8%.

  • Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

  • The ringgit , palm's currency of trade, strengthened 0.3% against the dollar, making the commodity slightly more expensive for buyers holding foreign currencies.

  • Indian palm oil imports surged to their highest in more than a year in October, while soyoil purchases hit a record high, as lower prices prompted refiners to step up buying to build stocks ahead of the festive season, five dealers said.

  • Indonesia's new commodity monitoring platform Danantara Sumberdaya Indonesia will use customs, trade and finance data to track export transactions while leaving contract negotiations to the market, its CEO Luke Mahony said.

  • Palm oil may retest support at 4,466 ringgit per ton, with a good chance of breaking below it and falling into the 4,399-4,440 ringgit range, Reuters technical analyst Wang Tao said. TECH/C

MARKET NEWS

  • Oil, chip stocks and the dollar were under pressure in Asia on Thursday and just about everything else was up after US voters swept the Democrats to a series of stunning midterm election wins, a result that raised hopes for an end to the US-Iran war. MKTS/GLOB

DATA/EVENTS

0700 Germany Industrial Orders MM Sep

0700 Germany Manufacturing O/P Cur Price SA Sep

0700 Germany Consumer Goods SA Sep

0930 UK S&P Global PMI: MSC Composite - Output Oct

1200 UK BOE Bank Rate Nov

1330 US Initial Jobless Clm 31 Oct, w/e

($1 = 4.0610 ringgit)


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