Palm extends losses to third session on weak demand, expectations of higher output

Malaysian palm oil futures slipped for a third consecutive session on Thursday, erasing earlier gains as export demand stayed sluggish. Business Recorder reported that the November contract on the Bursa Malaysia Derivatives Exchange closed 38 ringgit lower, or 0.78%, at 4,814 ringgit ($1,194.54) per metric ton.

Cargo surveyors put the drop in Malaysian palm product exports for August 1-25 at 11.4% to 20% versus a month earlier. Sunvin Group's Anilkumar Bagani said palm has traded at a premium over gas oil and lost competitiveness against soybean oil, with exports softer and output running above expectations.

Bagani said recent rain in Malaysia could support local production, although worries are rising about possible output losses next year because of hotspots and blazes in Indonesia's Kalimantan region. Crude futures fell on hopes that Iran-Qatar talks could reopen the Strait of Hormuz, while the ringgit weakened 0.2% against the dollar, making the commodity cheaper for foreign buyers.