Malaysian palm oil price falls to near 3-month low on weak Chinese oils

Malaysian palm oil futures saw their biggest rise in one-and-a-half months on Tuesday, rebounding by nearly 3 percent from sharp losses in the previous session, on a weaker ringgit and expectations of lower future production.

KUALA LUMPUR: Malaysian palm oil futures hit their lowest level in nearly three months on Monday, dragged down by losses in Chinese vegetable oils, while a stronger ringgit also weighed on sentiment earlier in the day. 

    The palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange had fallen 1.4 percent to 2,492 ringgit ($610) per tonne by the closing trade, posting its third loss in the past four sessions.

    Earlier in the day, the contract fell as much as 2.1 percent to 2,475 ringgit, its lowest since March 3. Last week, palm posted its second consecutive weekly decline, weighed down by the sell-off in Chinese commodities markets.     

    Traded volumes stood at 52,089 lots of 25 tonnes each on Monday evening compared with the 2015 daily average of 44,600.

    "Palm is kept down by external markets, Dalian's RBD (refined, bleached and deodorized) palm olein has continuously been under pressure," said a trader based in Kuala Lumpur. 

    The most actively traded September contract for palm olein on the Dalian Commodity Exchange dropped 2.2 percent on Monday.

    The ringgit rose on Monday morning before falling slightly by 0.2 percent to 4.0840 per dollar. A stronger ringgit make palm more expensive for holders of foreign currencies.

    In other vegetable oils, the Chicago Board of Trade soyoil contract for August fell 0.8 percent, while the September soybean oil contract on the Dalian Commodity Exchange dropped 2.4 percent.

    The offer price for crude palm kernel oil stood at 4,828 ringgit per tonne in the evening, according to price assessments by Thomson Reuters.- Reuters