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NEWS ADMIN

DATE

06/11/2019

NEWS PROVIDER

Siti Safura Masiron

NEWS SOURCE

Business Recorder

CATEGORY

HEADLINE

Palm oil down after hitting 21-month high

06.11.2019 (Business Recorder) - Malaysian palm oil futures ended lower on Tuesday after hitting a nearly two-year high earlier in the session as market players booked profits, but prices are expected to rise again as production slows.

The benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange closed 0.6% lower at 2,513 ringgit ($608.62) per tonne.

It earlier rose as much as 2.5% to its highest since January 2018, adding to gains of nearly 3% on Monday after expectations of higher demand for the oil for biodiesel in Indonesia and forecasts for a production slowdown prompted top industry analysts to raise their price outlook last week.

Industry analyst Dorab Mistry at a conference in Bali on Friday said Malaysian palm oil is likely to reach 2,700 ringgit in March, from an earlier estimate of 2,500 ringgit.

Market participants are confident that palm will reach the expected level next year, but prices have moved quickly and corrections are likely, a Kuala Lumpur-based trader said.

Palm has gained over 17% since mid-October.

Technical analysis showed palm oil was predicted to pull back further before rising again and may test resistance at 2,665 ringgit per tonne, said Wang Tao, a Reuters market analyst for commodities technicals.

In related oils, the Dalian's January palm oil contract rose nearly 3%, while the US soyaoil futures on the Chicago Board of Trade was down 0.7%.