Palm oil extends losses as supply concerns weigh

September 08, 2022: Malaysian palm oil futures extended losses on Thursday, as weaker related edible oils and concerns over rising supply continued to weigh on the oilseed.

The benchmark palm oil contract FCPOc3 for November delivery on the Bursa Malaysia Derivatives Exchange traded 0.57% lower at 3,669 ringgit ($815.70) a tonne, after hitting a six-week lowest closing in the previous session.

FUNDAMENTALS

A Reuters poll ahead of Malaysian Palm Oil Board data pegged a jump in inventories to 2.03 million tonnes as production expands. The data is due Sept. 12. PALM/POLL

Malaysian palm oil planters are letting thousands of tonnes of fruits rot as the third year of a worker shortage has left companies unable to increase their harvesting during the peak production season. 

Dalian's most-active soyoil contract DBYv1 fell 2.31%, while its palm oil contract DCPv1 dropped 2.08%. Soyoil prices on the Chicago Board of Trade BOc2 were traded flat.

Palm oil may break a support at 3,666 ringgit per tonne, and fall to 3,549 ringgit, Reuters technical analyst Wang Tao said. 

MARKET NEWS

Asian stocks made broad gains on Thursday, extending an overnight global rally, while oil prices steadied at levels not seen since before Russia's invasion of Ukraine. 

Reuters