Malaysian palm oil futures fell in choppy trade on Monday, dragged lower as oil prices slid to fresh 5-1/2-year lows, although losses in the ringgit and concerns over floods curbing palm supply propped up the market. Oil prices dropped to fresh 5-1/2-year lows on Monday as worries about a surplus of global supplies and lacklustre demand dragged on oil markets. Cheaper oil prices dent energy sector demand for palm as a biodiesel feedstock. However, they have also pulled down the Malaysian ringgit against the U.S. dollar, making ringgit-priced palm oil more attractive for overseas buyers and refiners. The ringgit, Asias weakest currency in 2014, fell 0.6 percent to 3.5350 on Monday. Its a very uncertain market, said a trader with a foreign commodities brokerage in Kuala Lumpur. We have good and bad factors in the market. Externally the market is weak - Dalian and crude oil are coming down. But theres also a weak ringgit, followed by persisting floods. The benchmark March contract had dropped 0.9 percent to 2,262 ringgit ($640) per tonne by Mondays close, at the lower end of the days trading range of 2,262 and 2,297 ringgit. Total traded volume stood at 32,944 lots of 25 tonnes, below the usual 35,000 lots.
Posted on: Tue, 06 Jan 2015 03:51:13 +0000