MUMBAI, 09 Dec (Commoditiescontrol): Malaysian crude palm oil (CPO) futures closed lower on Monday, reflecting the broader decline in rival vegetable oils traded on the Dalian and Chicago exchanges. Traders are awaiting data from the Malaysian Palm Oil Board (MPOB), expected tomorrow, for further market direction.
The benchmark CPO contract for February delivery on the Bursa Malaysia Derivatives Exchange closed down by 10 ringgit, or 0.2%, at 5,118 ringgit ($1,157.39) per metric ton. Market activity is expected to remain rangebound on Monday, with traders cautious ahead of the official MPOB data release.
Malaysia’s palm oil inventories are likely to have dropped in November for the second consecutive month, driven by disruptions caused by torrential rains, according to a Reuters survey. A flood in Malaysia last week, following heavy rains in November, added to concerns over production. The country’s meteorological department has forecast a monsoon surge from December 8 to 14, which is expected to bring continuous rainfall to the east coast of Peninsular Malaysia and parts of Sabah and Sarawak on Borneo Island.
On the same day, Dalian’s most-active soyoil contract fell by 0.71%, and its palm oil contract slipped by 0.23%. On the Chicago Board of Trade, soyoil dropped by 0.28%. Palm oil prices often follow the movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Meanwhile, oil prices rose by more than 1% on Monday after China, the world’s top importer of oil, signaled a shift toward looser monetary policy for the first time since 2010 in an effort to boost economic growth. However, weaker crude oil futures make palm oil a less attractive option for biodiesel production, potentially dampening demand for palm oil as a feedstock.
With these developments, the outlook for Malaysian palm oil remains uncertain, as the market continues to navigate through fluctuating oil prices, weather-related disruptions, and awaiting further market cues.
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(By Commoditiescontrol Bureau; +91 98201 30172)
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