Palm oil slips over 2% on higher production outlook

March 17, 2022: Malaysian palm oil futures fell more than 2% on Thursday, tracking losses in rival Dalian oils, as traders weighed an industry group's forecast of a surge in early-March production.

The benchmark palm oil contract FCPOc3 for June delivery on the Bursa Malaysia Derivatives Exchange slid 141 ringgits, or 2.32%, to 5,946 ringgit ($1,420.45) a tonne during early trade.

FUNDAMENTALS

* The Southern Peninsula Palm Oil Millers' Association estimated March 1 to 15 output to rise 33% from the month before, traders said on Wednesday.

* Dalian's most-active soyoil contract DBYcv1 fell 0.3%, while its palm oil contract DCPcv1 was down 1%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.2%.

* 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 slide to 5,744 ringgit per tonne to complete a wave c from 7,268 ringgit, Reuters technical analyst Wang Tao said. TECH/C

MARKET NEWS

* Japan and Hong Kong markets led a jump in regional stocks, joining a rally on Wall Street overnight as potential risks from Federal Reserve monetary tightening to the Ukraine war and a slowdown in China became less murky.

* Oil futures rose in early trading, recovering some of the prior day's losses after the International Energy Agency said a decline in oil demand due to higher prices would not offset a shut-in of Russian oil supplies.

Reuters