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Palm oil tracks losses in rival soyoil

December 8, 2021: Malaysian palm oil futures slipped on Wednesday, after two sessions of gains, as the market tracked losses in rival soyoil after the U.S raised a proposal to scale back biofuel blending mandates, Reuters stated.

The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange slid 40 ringgits, or 0.81%, to 4,889 ringgit ($1,159.77) a tonne during early trade.

It had gained 0.14% during the overnight trade.

FUNDAMENTALS

* The Biden administration on Tuesday proposed scaling back the amount of biofuels that U.S. oil refiners were required to blend into their fuel mix since the onset of the COVID-19 pandemic.

* Soyoil prices on the Chicago Board of Trade fell 1.9%. Dalian's most-active soyoil contract eased 0.6%, while its palm oil contract also slipped 0.7%.

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

* Oil prices edged lower on Wednesday, reversing gains from earlier the week, as investors tried to assess the full impact of the Omicron coronavirus variant on global fuel demand and the effectiveness of existing vaccines.

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

* Palm oil may rise more towards the peak of wave b at 5,069 ringgit per tonne, as its uptrend from 4,032 ringgit may have resumed, Reuters technical analyst Wang Tao said.

Reuters

Posted on: 2021-12-08T09:25:03+05:00

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