Malaysian palm oil futures fell on Thursday evening, hitting a five-month low and recording a ninth straight day of losses, as traders sell because of concerns of export weakness.
A strengthening ringgit and falls in competing vegetable oils have also undermined the edible oil. A stronger ringgit, the currency of trade for palm, makes it more expensive for foreign currency holders.
It earlier rose against the dollar to an intraday high of 4.0800, before weakening slightly by 0.01% to reach 4.0990 in the evening.
Benchmark palm oil futures for September delivery on the Bursa Malaysia Derivatives Exchange were down 1.8% at 2,415 ringgit per tonne in the evening. The market earlier fell to its lowest since Jan 21 at 2,412 ringgit.
Traded volume stood at 58,026 lots of 25 tonnes each in the evening, versus the 2015 daily average of 44,600 lots.
"There are fears about further demand in the months to come after Eid, and these are high production months," said a trader from Kuala Lumpur.
"Demand is a question mark, we don't know how good exports will be after Eid. The export tax is also a deterrent to a certain extent by making us more uncompetitive."
Malaysia announced on Wednesday that it would raise its crude palm oil export tax to 6% for the month of July, up from 5.5% this month.
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