Palm oil snaps four-day rally on weaker rival soyoil and crude
JAKARTA: Malaysian palm oil futures snapped a four-session rally on Tuesday, weighed down by rival soyoil at the Dalian and Chicago markets and the fall of crude prices.
The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange lost RM84, or 2.04 per cent, to RM4,042 (US$950.39) a metric ton in early trade.
Dalian's most-active soyoil contract fell 1.82 per cent, while its palm oil contract shed 1.9 per cent. Soyoil prices on the Chicago Board of Trade were down 1.05 per cent.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Oil prices tumbled to a more than one-week low as US President Donald Trump said a ceasefire has been agreed between Iran and Israel, relieving worries of supply disruption in the area.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Indonesia exported 1.78 million metric tons of palm oil, including refined products, in April, down from 2.18 million tons a year earlier, data from the Indonesia Palm Oil Association (GAPKI) showed.
India's soyoil imports in June are likely to fall by 18 per cent from a month ago to a four-month low, as congestion at a key port will lead to unloading vessels into July instead of June.
The ringgit, palm's currency of trade, strengthened 0.93 per cent against the dollar, making the commodity more expensive for buyers holding foreign currencies.
Palm oil may break support of RM4,066 per metric ton, and fall towards RM4,017, Reuters technical analyst Wang Tao said.
Global shares rallied and the dollar extended declines after Trump said Iran and Israel had agreed to a ceasefire.
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