Palm oil price slips on weaker exports

Profitable: Excluding the forex gain, IOI said the underlying pre-tax profit in Q2 was up 76% year-onyear at RM649.2mil on a 3.9% higher revenue of RM2.97bil.

KUALA LUMPUR: Malaysian palm oil futures reversed course to fall slightly in late trade on Thursday, as export demand remained weak ahead of data on early April shipments. 

The palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange dipped 0.1 percent, settling at 2,657 ringgit ($683) per tonne at the close of trade. Traded volumes were 51,099 lots of 25 tonnes each, above a 2015 daily average of 44,600 lots.

"Exports are dwindling because of higher prices. We should see some pressure on prices," said a Kuala Lumpur-based trader. "The market is trying to recover but it's still not getting any momentum."

Another trader said the range-bound market was awaiting new leads, such as data from cargo surveyors Intertek Testing Services and Societe Generale de Surveillance. 

Shipment data for the first 15 days of April is due to be released on Friday, and could show declines from the corresponding period a month ago due to an export tax on crude palm oil. Shipments in the first 10 days of April fell 1-2 percent.  

Malaysia introduced a 5 percent tax on crude palm oil for April, ending a duty-free policy in place since May 2015.

The September soybean oil contract on the Dalian Commodity Exchange rose 0.4 percent, while the May Chicago Board of Trade soyoil contract gained 0.2 percent.

The offer price for crude palm kernel oil fell to 4,927.31 ringgit ($1,267) per tonne in late trade, from 4,943.85 ringgit on Wednesday, according to price assessments by Thomson Reuters.