Palm oil dropped to the lowest level in five weeks, falling for a third session, on concern that Europe’s debt crisis is set to worsen, crimping demand for commodities including edible oils.
The October-delivery contract lost 2.1 percent to end at 2,926 ringgit ($920) a metric ton on the Malaysia Derivatives Exchange, the lowest settlement for a most-active contract since June 18. Futures have declined 7.8 percent this year.
Moody’s Investors Service cut its outlook for Germany, the Netherlands and Luxembourg to negative, citing the region’s fiscal crisis. Greece’s creditors meet today amid skepticism that the country will achieve bailout targets.
“These downgrades can only reinforce the concern in the market,” James Ratnam, an analyst at TA Securities Holdings Bhd., said by phone today. “All these financial risks will add anxiety into how demand will pan out.”
Soybeans for November delivery fell 2.2 percent to $15.87 a bushel on the Chicago Board of Trade. Futures surged yesterday to a record $16.915. December-delivery soybean oil declined 2.2 percent to 53.38 cents per pound. Palm oil and soybean oil are used in food and fuels.
Palm oil for January delivery lost 2.2 percent to close at 7,706 yuan ($1,207) a ton on the Dalian Commodity Exchange, the lowest close for the most-active contract since June 15. Soybean oil for the same month fell 2.4 percent to 9,396 yuan a ton.