Palm Posts Worst Weekly Loss Since March Before Malaysian DataSwansy Afonso
Palm oil posted the biggest weekly drop in more than eight months before a report from Malaysia expected to show that stockpiles gained even as production declined last month.
The contract for January delivery fell 1.5 percent to 2,506 ringgit ($788) a metric ton on the Bursa Malaysia Derivatives, the lowest close for most-active futures since Oct. 29. Prices declined 4.6 percent this week, the most since the five days ending March 1.
Palm oil jumped 7.5 percent last week, the most since April 2009, on speculation that output in top producers Indonesia and Malaysia may be less than analysts expected. Prices rose to 2,628 ringgit on Nov. 1, the highest close since September 2012 and 21 percent more than the 2,167 settlement on July 29, meeting the common definition of a bull market.
“The market ran up sharply” last week, said Sandeep Bajoria, chief executive officer of Sunvin Group in Mumbai. The rally slowed demand and some investors are waiting for the Malaysian Palm Oil Board report due on Nov. 11, he said.
Production in Malaysia probably fell 2.1 percent to 1.87 million tons in October from a month earlier, according to a Bloomberg survey published Nov. 6. Exports were little changed at 1.6 million tons, while reserves rose 3.4 percent to 1.84 million tons, the highest since April, the survey showed. Output is typically highest from July to October.
Soybean oil for December delivery lost 0.7 percent to 40.44 cents a pound on the Chicago Board of Trade. Soybeans for delivery in January was little changed at $12.6575 a bushel.
Refined palm oil for May delivery dropped 0.5 percent to end at 6,228 yuan ($1,023) a ton on the Dalian Commodity Exchange and soybean oil slid 0.6 percent to close at 7,160 yuan.