Palm Drops to Three-Week Low as Lower Exports May Boost ReservesSwansy Afonso
Palm oil fell to the lowest in three weeks on speculation that a decline in exports from Malaysia, the world’s second-largest producer, may expand stockpiles of the tropical oil used in everything from noodles to detergents.
The contract for April delivery retreated 1.2 percent to 2,528 ringgit ($760) a metric ton on the Bursa Malaysia Derivatives, the lowest level for the most-active futures at close since Jan. 15. Futures declined 3.8 percent in January, the first monthly drop in four.
Shipments from Malaysia declined 11 percent to 1.28 million tons in January from a month earlier, independent surveyor Intertek said yesterday. Exports fell 11 percent to 1.27 million tons in January, SGS (Malaysia) Sdn., said.
“Prices are down due to the weak exports data for January and slower offtake during the festive holidays,” said Ivy Ng, an analyst at CIMB Investment Bank Bhd. in Kuala Lumpur. Markets were shut on Jan. 31 and Feb. 3 for the Chinese new year and a local holiday. China, the second-biggest importer, is shut for the Lunar New Year holidays until Feb. 6.
Stockpiles in Malaysia climbed to a nine-month high of 1.99 million tons in December, according to the nation’s palm oil board. Exports fell for a second month to 1.51 million tons in December, board data showed.
Soybean oil for March delivery dropped 0.2 percent to 37.36 cents a pound on the Chicago Board of Trade, while soybeans gained 0.2 percent to $12.9475 a bushel.