Palm down on profit taking

January 14, 2021: Malaysian palm oil futures fell on Friday tracking weaker rival oils, while traders also booked profits after the contract rose to an all-time closing high on concerns of persisting labour shortage.

The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange lost 55 ringgit, or 1.07%, to 5,106 ringgit ($1,220.95) a tonne in early trade. It also lost 0.7% overnight but looked set for a weekly gain.

FUNDAMENTALS

 The market is on a profit-taking mode after Thursday's rally, and tracking Dalian and soyoil weakness, a Kuala Lumpur-based trader said.

Dalian's most-active soyoil contract dropped almost 1%, while its palm oil contract slipped 0.7%. Soyoil prices on the Chicago Board of Trade were down 1.1%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Palm oil may test a support at 5,094 ringgit per tonne, and a break below could open the way to 5,001 ringgit, Reuters technical analyst Wang Tao said.

Reuters