KUALA LUMPUR: Malaysian palm oil futures fell nearly 2% on Monday to their lowest in a month, weighed down by losses in soyoil on the U.S. Chicago Board of Trade (CBOT) and weaker export demand.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was down 1.7% at 1,994 ringgit ($479.10) per tonne at the close of trade.
It earlier fell as much as 1.8% to 1,991 ringgit, its weakest since May 14.
The breach of support at 2,019 ringgit per tonne could set up a trading range of 1,960-1,997 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
"Palm tracked weakness in the U.S. soybean market, as well as lower exports," said a futures trader in Kuala Lumpur, referring to Malaysian palm oil export data which showed weaker demand in the first ten days of June.
Malaysian palm oil exports from June 1-10 fell around 31% from the corresponding period in May, according to independent inspection company AmSpec Agri Malaysia and cargo surveyor Intertek Testing Services.
Slowing export demand could contribute to rising inventory levels and weigh on benchmark palm oil prices. Malaysian palm oil stockpiles last fell 6.6% in April to 2.73 million tonnes.
Industry regulator the Malaysian Palm Oil Board is scheduled to release inventory, production and export data for May on June 12.
Meanwhile, the Chicago July soybean oil contract declined 1.4% on Friday, and was down again on Monday by 0.4%.
U.S. soy, wheat and corn prices charted declines as U.S. farmers are expected to get a window of dry weather this week for planting.
In other related oils, the September soyoil contract on the Dalian Commodity Exchange rose 0.3%, and the Dalian September palm oil contract edged down 0.1%.
Palm oil prices are affected by movements in related edible oils, with which it competes for global market share. - Reuters