Mumbai, 15 April (Commoditiescontrol) : Palm oil prices edged lower at Malaysian exchange on Monday, weighed down by lacklustre global demand although shrinking inventories in the world's second largest producer capped the fall in prices.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange slipped 5 ringgit or 0.12%, to 4,277 ringgit ($895.71) a metric ton by the midday break.
"Market got some support from resumption of Chinese palm oil buying on Friday but other destinations were lacking charm," a research analyst said.
Malaysia's palm oil stocks at the end of March declined 10.68% from the previous month to 1.71 million metric tons, the lowest in ten months, as a surge in exports overshadowed output, according to Malaysian Palm Oil Board data released today.
Crude palm oil production rose 10.57% to 1.39 million tons for the period, while palm oil exports ticked up 28.61% to 1.32 million tons, as per the data.
Production in April will likely be smaller than March due to slower harvesting during the Ramadan and Eid al-Fitr holidays during the first half of the month, which would further deplete inventories, he added.
Cargo surveyors are also expected to release export estimates for April 1-15.
Crude oil prices dropped on Monday as market participants dialled back risk premiums following Iran's attack on Israel late on Saturday, which the Israeli government said caused limited damage. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Dalian's most-active soyoil contract rose 0.66% while its palm oil contract lost 0.64%. Soyoil prices on the Chicago Board of Trade were up 0.59% during Asian hours.
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