Malaysian palm oil futures retreated on Wednesday from a three-day climb, as the contract tracked weakness in rival soyoil.
The benchmark palm oil contract FCPOc3 for October delivery on the Bursa Malaysia Derivatives Exchange lost 33 ringgit, or 0.8%, to 4086 ringgit ($917.17) a tonne by the midday break.
Malaysia’s end-July palm oil stocks expanded to an eight-month peak on the back of improving production and soaring imports, according to data from industry regulator the Malaysian Palm Oil Board (MPOB) released during the midday break.
Crude palm oil production climbed 1.84% to 1.57 million tonnes from June levels, while palm oil exports grew 10.72% to 1.32 million tonnes, MPOB said.
“Data seen bullish … exports rose much higher than expected notching just over 10% rise, compared with average expectation of 3.12% rise. Iran, India, Turkey, Kenya and the Philippines emerged as the top buyers, taking advantage of palm in the absence of sunflower oil from the Black Sea, particularly true for Iran and Turkey,” said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
“Stocks rose to eight months despite the large increase in exports due to higher imports and beginning stocks,” he added.
Dalian’s most-active soyoil contract DBYcv1 was up 0.9%, while its palm oil contract DCPcv1 was flat. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.7%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Source: Reuters (Reporting by Chen Lin; Editing by Sherry Jacob-Phillips)
