Palm Oil Futures Drop as Prices at Seven-Month High Spur SellingSwansy Afonso
Palm oil declined the most in four weeks after a rally to a seven-month high spurred some investors to lock in gains.
The contract for delivery in January retreated 0.9 percent to 2,461 ringgit ($780) a metric ton on the Bursa Malaysia Derivatives, the biggest drop at close for the most-active futures since Sept. 26. Palm for physical delivery in November was at 2,455 ringgit today, data compiled by Bloomberg show.
Futures rallied for the fourth day yesterday to close at the highest level since March on speculation that output in Malaysia, the world’s second-largest producer, may increase at a slower pace and cap inventories. The commodity, used in everything from noodles to biofuels, has gained 6.1 percent this month, erasing losses this year.
“There has been some profit taking after the recent good run,” said Donny Khor, deputy director of futures and commodities at RHB Investment Bank Bhd. in Kuala Lumpur. “This is a breather before a bull run as the underlying market is looking positive on expectations of lower production.”
Soybeans for delivery in January fell 0.2 percent to $13.02 a bushel on the Chicago Board of Trade, while soybean oil for December was unchanged at 41.50 cents a pound.
Refined palm oil for May delivery dropped 0.9 percent to close at 6,124 yuan ($1,007) a ton on the Dalian Commodity Exchange and soybean oil fell 0.2 percent to end at 7,202 yuan.