Business Recorder (20/03/2020) - Malaysian palm oil futures closed lower on Thursday as worries deepened over the damage to global demand due to coronavirus.
The benchmark palm oil contract, for June delivery, on the Bursa Malaysia Derivatives Exchange settled down 1.03% at 2,216 ringgit ($502.49) per tonne.
The contract fell on Wednesday after Malaysia, the world's second-largest palm producer, exempted palm plantations, millers and refiners from a restricted movement order due to the pandemic, easing fears of a disruption in supply.
“Following the consent for planters to resume work, we expect crude palm oil price to give up some of its gains as the market will likely focus its attention back to potential demand destruction from COVID-19," Ivy Ng, regional head of plantations research at CIMB Investment Bank, said in a note to clients.
Concerns over global demand for the edible oil have continued to grow as the fast-spreading virus has now infected more than 212,000 people and killed over 8,700, triggering lockdowns and raising fears of a global recession.
The market is expecting March 1-20 exports to fall 20% from the month before, traders said.
Dalian's most-active soyaoil contract gained 1.48%, while its palm oil contract fell 2.1%. Soyaoil prices on the Chicago Board of Trade were up 1.04%.
Palm oil is affected by price movements in related oils as it competes for a share of the global vegetable oils market.
Palm oil may drop to 1,849 ringgit per tonne next quarter, as suggested by its wave pattern and a projection analysis, Reuters technical analyst Wang Tao said.
Read more at https://www.brecorder.com/2020/03/20/581665/palm-oil-ends-lower/