Palm Oil Ends at Six-Week Low on Speculation Exports Set to SlowRanjeetha Pakiam
Palm oil closed at the lowest level in almost six weeks on speculation that exports from Malaysia, the world’s second-largest producer, may slow after the Muslim fasting month of Ramadan starting this month.
The contract for September delivery ended at 2,343 ringgit ($741) a metric ton on the Bursa Malaysia Derivatives, the lowest price at close for the most active futures since May 21. Palm for local physical delivery in July was at 2,360 ringgit, data compiled by Bloomberg show.
Shipments from Malaysia gained 7 percent to 1.35 million tons in June from a month earlier, surveyor Intertek said today. Exports climbed 5.4 percent, according to SGS (Malaysia) Sdn. Consumption typically increases during Ramadan, which is scheduled to begin around July 9 this year, when observers break day-long fasts with communal meals.
“The increase in exports will be a definitive factor until Ramadan,” said Prathamesh Mallya, an analyst at AnandRathi Commodities Ltd. in Mumbai. “After Ramadan, you’ll see no more festivals until October. I would see slight demand still being there -- demand will remain constant, but incremental demand will not be there.”
Soybean oil for December delivery gained 0.8 percent to 45.50 cents a pound on the Chicago Board of Trade, rebounding from the lowest close for the most-active futures since October 2010 on June 28, while soybeans for delivery in November were little changed at $12.5325 a bushel.
Refined palm oil for January delivery gained 1.1 percent to close at 5,910 yuan ($964) a ton on the Dalian Commodity Exchange, while soybean oil for delivery in the same month advanced 1.2 percent to end at 7,382 yuan.