Palm retreats on profit-taking, weak demand

Business Recorder reported that Malaysian palm oil futures declined on Wednesday, halting a two-session rally. The benchmark November contract on the Bursa Malaysia Derivatives Exchange lost 21 ringgit, or 0.42%, to 4,952 ringgit ($1,225.44) per tonne by midday. Paramalingam Supramaniam of brokerage Pelindung Bestari linked the fall to profit-taking and subdued palm demand.

Cargo inspectors put August shipments of Malaysian palm products 6.5% to 14.9% lower than in July. Supramaniam added that India looks well supplied, so high prices may not appeal to its buyers. Dalian's palm contract dropped 1%, and soyoil slipped 0.67% on the Chicago Board of Trade.

Crude prices gained following overnight strikes between the US and Iran, and firmer crude makes palm more appealing as a biodiesel input. A 0.12% slide in the ringgit against the dollar also lowered palm's cost for overseas purchasers. Market participants now look ahead to Malaysian Palm Oil Association data on August output, and to whether hot, dry weather hurt production.