Palm oil slips as Indonesia lowers thresholds on export levies

September 01, 2022: Malaysian palm oil futures slipped on Thursday, tracking weaker rival oils, after top producer Indonesia lowered the thresholds for its levies on shipments of the commodity.

The benchmark palm oil contract FCPOc3 for November delivery on the Bursa Malaysia Derivatives Exchange slid 16 ringgit, or 0.39%, to 4,125 ringgit a tonne during early trade.

FUNDAMENTALS

*The new levies by Indonesia will come into effect on Nov. 1, marking an end to several months where the country waived the tariffs to encourage shipments amid a glut in domestic stock. 

Indonesia has set its crude palm oil reference price at $929.66 per tonne for Sept. 1-15 period, putting the export tax lower than previously expected at $74 per tonne. 

Exports of Malaysian palm oil products for August rose 1.6% to 1,299,116 tonnes from July, cargo surveyor Intertek Testing Services said on Wednesday. 

Dalian's most-active soyoil contract DBYcv1 fell 0.7%, while its palm oil contract DCPcv1 lost 0.3%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 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 is poised to break a support at 4,085 ringgit per tonne, and fall towards 3,857 ringgit, Reuters technical analyst Wang Tao said. 

Reuters

MARKET NEWS

* Asian stocks slid and the dollar spiked, as investors greeted September by selling everything that was not nailed down after a month battered by concerns about aggressive rate hikes from global policymakers. MKTS/GLOB