Jan. 4 (Bloomberg) -- Palm oil declined on speculation some investors may have deferred buying after Malaysia, the world’s second-largest producer, changed its export tax structure starting this month.
The contract for March delivery dropped 0.3 percent to close at 2,467 ringgit ($808) a metric ton on the Malaysia Derivatives Exchange. Palm oil retreated 1.2 percent this week.
Futures lost 23 percent last year as inventories expanded for five months to reach a record 2.56 million tons in Malaysia in November, according to palm oil board data. The government said in October it would cut the export tax to between 4.5 percent and 8.5 percent, from 23 percent, effective Jan. 1 to help trim the stockpile. The tariff for this month was set at zero as the base price was below the minimum threshold of 2,250 ringgit that triggers the 4.5 percent rate.
“With uncertainty over demand, players were averse on going long,” said Paramalingam Supramaniam, director at Pelindung Bestari Sdn.
In December, exports fell 5.7 percent to 1.57 million tons from a month earlier, Intertek said Dec. 31. Shipments dropped 7.9 percent to 1.52 million tons, Societe Generale de Surveillance estimated. The two surveyors are scheduled to give estimates for the first 10 days of January on Jan. 10.
“Export estimates from Intertek and SGS on the 10th may give a rough idea whether the exports have improved with the new tax in Malaysia,” said Chandran Sinnasamy, head of trading at LT International Futures Sdn. in Kuala Lumpur.
Palm oil for May delivery advanced 1.5 percent to close at 7,028 yuan ($1,128) a ton on the Dalian Commodity Exchange. Soybean oil for May rose 1.8 percent to end at 8,768 yuan a ton.
Soybeans for March delivery gained 0.1 percent to $13.88 a bushel on the Chicago Board of Trade as at 8:33 p.m. Singapore time. Soybean oil for delivery in March dropped 0.5 percent to 50.47 cents a pound.
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