Palm slips for second day as crude prices fall

March 31, 2022: Malaysian palm oil futures fell for a second straight session on Thursday, dragged down by a drop in oil prices on news that the United States may tap its reserves, while investors waited for March export data from cargo surveyors.

The benchmark palm oil contract FCPOc3 for June delivery on the Bursa Malaysia Derivatives Exchange slid 68 ringgit, or 1.15%, to 5,862 ringgit ($1,395.38) a tonne in early trade.

FUNDAMENTALS

Traders are awaiting cargo surveyors to release export shipment data for March.

Oil futures dived more than $5 a barrel on reports that the Biden administration is weighing releasing some 1 million barrels of oil per day from strategic reserves for several months in a bid to calm soaring crude prices. O

Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

Dalian's most-active soyoil contract DBYcv1 gained 0.6%, while its palm oil contract DCPcv1 fell 0.5%. Soyoil prices on the Chicago Board of Trade BOcv1 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.

MARKET NEWS

Asian stocks eased after this week's global rally, following Wall Street's overnight stumble, while oil dropped sharply as the United States weighed a massive draw from its reserves to rein in surging fuel prices. 

Reuters