Palm Oil Drops for Fourth Day on Concern Stockpiles Will Expand
Palm oil declined for a fourth day to the lowest level in more than a week on speculation that stockpiles in Malaysia, the largest producer after Indonesia, will climb from a record as exports drop.
The contract for February delivery lost 0.7 percent to 2,395 ringgit ($783) a metric ton on the Malaysia Derivatives Exchange, the cheapest settlement price at close for the most- active contract since Nov. 12. Futures, little changed this week, are heading for a 25 percent drop this year.
Inventories gained for a fourth month to reach an all-time high of 2.51 million tons in October, according to data from the Malaysian Palm Oil Board. Shipments dropped 3.8 percent to 1.01 million tons in the first 20 days of November from a month earlier, Societe Generale de Surveillance said on Nov. 20.
“There are some concerns that the stocks may climb again because of the poor export data,” said Ivy Ng, an analyst at CIMB Group Holdings Bhd. “Production is supposed to come off but exports have also come off, so the issue is whether the production fall is bigger than the export fall.”
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