Palm slips from six-week closing high

August 15, 2022: Malaysian palm oil futures fell on Monday from a six-week closing high hit in the previous session, weighed down by weakness in rival soyoil after a U.S. government report raised the country's soybean forecast.

The benchmark palm oil contract FCPOc3 for October delivery on the Bursa Malaysia Derivatives Exchange slid 95 ringgit, or 2.16%, to 4,312 ringgit ($968.34) a tonne during early trade.

FUNDAMENTALS

U.S. soybean production will be bigger than previously forecast as better-than-expected yields will more than makeup for a cut to acreage, the government said on Friday. 

Soyoil prices on the Chicago Board of Trade BOcv1 were down 2.1%. Dalian's most-active soyoil contract DBYcv1 fell 0.4%, while its palm oil contract DCPcv1 rose 0.4%.

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

Palm oil faces resistance at 4,452 ringgit per tonne, it may hover below this level or retrace towards support at 4,269 ringgit, Reuters technical analyst Wang Tao said. 

MARKET NEWS

Asian shares turned mixed after China's central bank trimmed key lending rates as a raft of economic data missed forecasts, underlining the need for more stimulus to support the world's second-largest economy. 

Reuters