Palm tracks rival oils lower

December 14, 2021: Malaysian palm oil futures tracked rival oils lower on Tuesday, although expectations of a fall in December production limited the decline.

The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange slid 62 ringgits, or 1.29%, to 4,730 ringgits ($1,118.20) a tonne in early trade, heading for a second straight session of fall.

It had fallen 0.1% during the overnight trade.

FUNDAMENTALS

* The Southern Peninsula Palm Oil Millers' Association (SPPOMA) estimated production during Dec. 1-10 fell 2.8% from the same period in November, traders said on Monday.

* India's vegetable oil imports in November rose 11% from a year earlier to 1.17 million tonnes, as soyoil imports more than doubled, a leading trade body said.

* Dalian's most-active soyoil contract fell 1.5%, while its palm oil contract slipped 1.1%. Soyoil prices on the Chicago Board of Trade were down 0.34%.

* 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 break a support at 4,751 ringgit per tonne, and fall into 4,625-4,676 ringgit range, Reuters technical analyst Wang Tao said.

MARKET NEWS

* Asian stocks and oil prices slipped as the spread of the Omicron coronavirus variant rattled investors who were already on edge ahead of a slew of central bank decisions this week, including a key Federal Reserve meeting.

* Oil prices edged higher but price gains were capped due to investor worries about oil demand after renewed restrictions were imposed in Europe and Asia amid a rise in coronavirus cases.

Reuters