Mumbai, 22 April (Commoditiescontrol): Palm oil prices slipped on Monday tracking weakness in the energy market.
BMD CPO futures erased early gains and were set for a seven-session decline as expectations of higher palm production narrowed differentials among rival edible oils, while lower oil prices also weighed.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives (BMD) Exchange was down 7 ringgit, or 0.18%, at 3,919 ringgit ($819.53) a metric ton by midday break.
With destinations having rationed palm imports in response to high prices, palm is beginning to compete with alternative oils on price in anticipation of normal seasonally increased production, a market observer said.
Dalian's most-active soyoil contract rose 0.16%, while its palm oil contract lost 0.97%. Soyoil prices on the Chicago Board of Trade gained 0.18% higher during Asian hours.
Palm oil normally takes directions from the price movements in related oils as they compete for a share in the global vegetable oils market.
Crude oil prices edged lower dragged down by a renewed focus on market fundamentals, as Israel and Iran played down the risks of an escalation of hostilities in the Middle East after Israel's apparently small strike on Iran. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Independent inspection company AmSpec Agri Malaysia said exports of Malaysian palm oil products for April 1-20 climbed 14.3% from March 1-20 levels, while cargo surveyor Intertek Testing Services said palm exports rose 10.2%.
Rains will pick up across Indonesia and Malaysia in late April, LSEG said in a weather forecast report, adding that "the uptick in rainfall without raising flooding concerns makes for a very positive outlook for Indonesia/Malaysia palm oil".
The Malaysian ringgit was down 0.02% against the dollar.
(By Commoditiescontrol Bureau; +91-9820130172)
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