KUALA LUMPUR: Malaysian palm oil futures fell 2% at the close of trade on Thursday, hitting their lowest level in a week as they tracked weakness in related edible oils.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange closed 2% down at 2,016 ringgit ($481.03) per tonne at the end of the trading day, its sharpest daily decline in three weeks and its second consecutive day of losses.
It earlier fell to 2,012 ringgit, its weakest since May 14.
"The market is weighed by external market weakness, all related commodities are down," said a Kuala Lumpur-based trader, referring to prices of crude oil and edible oils such as soyoil.
Palm oil may test a support at 2,034 ringgit per tonne, and a break below that could cause losses to 1,967 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
In related edible oils, the Chicago July soybean oil contract eased 0.7%, while the September soyoil contract on the Dalian Commodity Exchange was down 1.4%.
The Dalian September palm oil contract fell 1.6%.
Palm oil prices are affected by movements in soyoil, with which it competes for global market share.
Crude oil prices also fell, extending losses from the previous session amid surging U.S. inventories as low refinery runs and trade tensions weighed on the demand outlook. - Reuters