Palm Oil Falls After 3 Days Of Gains On Lower Crude, Soybean Oil

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Malaysian palm oil futures fell on Monday after three straight sessions of gains, dragged by weaker crude and CBOT soybean oil prices amid concerns over slowing demand due to the coronavirus outbreak.

The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange slid 32 ringgit, or 1.53%, to 2,056 ringgit ($473.73) per tonne by 0249 GMT.

Palm oil prices fell 13% last month due to a historic rout in crude oil and as coronavirus-led lockdowns around the globe curbed demand.

FUNDAMENTALS

US President Donald Trump and Secretary of State Mike Pompeo added to worries with fresh efforts to pin blame for the pandemic on China, where the new coronavirus outbreak is believed to have originated.

Oil prices fell in early trade on worries the global oil glut may persist as US-China trade tension could hold back an economic recovery even as coronavirus lockdowns start to ease.

Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

Soyoil prices on the Chicago Board of Trade (CBOT) were down 1.13%. The Dalian was closed for trading.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Palm oil may drop into a zone of 2,014-2,043 ringgit per tonne, as suggested by its wave pattern and a projection analysis, Reuters technical analyst Wang Tao said.

Source ETMARKETS

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