(April 11): Malaysian palm oil futures fell on Monday evening, on the back of a stronger ringgit and official data showing that output rose in March.
The palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange closed 0.5% down at 2,667 ringgit (US$686) a tonne for a fifth straight session of declines. It earlier touched an intraday low of 2,661 ringgit, its lowest since March 24.
Traded volumes were 35,643 lots of 25 tonnes each, against last year's daily average of 44,600 lots.
Traders said the market fell, because of stronger than expected output data from the Malaysian Palm Oil Board (MPOB), which reported a 16.9% rise in production and a 13.1% decline in stockpiles.
Malaysian shipments in March rose by 22.9% from a month earlier, as sellers rushed to export crude palm oil, ahead of a 5% export duty starting in April.
"MPOB stocks data could have been lower, and output was higher than expected by almost 10 percent," one palm trader said, referring to personal estimates, while another said that the stronger ringgit had capped palm's upside.
A Reuters poll of nine planters, traders and analysts had earlier forecast output to rise by 8% month-on-month to 1.13 million tonnes.
A stronger ringgit, the currency used for palm oil trading, drags on the vegetable oil's price. The ringgit strengthened 0.3% to 3.8870 against the dollar on Monday evening, making palm oil more expensive for holders of foreign currencies.
Palm oil still targets 2,629 ringgit a tonne, as it has cleared a support at 2,716 ringgit, said Wang Tao, Reuters market analyst for commodities and energy technicals.
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