Palm oil tracks soyoil lower as U.N. seeks to restore Ukraine grain exports

May 19, 2022: Malaysian palm oil futures slipped on Thursday, as rival soyoil plunged overnight following a report about the United Nations' efforts to restore Ukraine grain shipments.

The benchmark palm oil contract FCPOc3 for August delivery on the Bursa Malaysia Derivatives Exchange slid 104 ringgit, or 1.70%, to 6,030 ringgit ($1,369.52) a tonne during early trade.

FUNDAMENTALS

Indonesia's trade minister on Wednesday said he expected prices of cooking oil would stabilize after a program to distribute subsidized supplies reaches 10,000 locations across the country. 

U.N. Secretary-General Antonio Guterres said on Wednesday that he is in “intense contact” with Russia, Ukraine, Turkey, the United States, and the European Union in an effort to restore Ukrainian grain export as a global food crisis worsens. 

Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.7% after slumping 3.1% overnight. Dalian's most-active soyoil contract DBYcv1 and its palm oil contract DCPcv1 both eased by 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 may test a support at 5,984 ringgit per tonne, a break below which could open the way towards 5,843 ringgit, Reuters technical analyst Wang Tao said. 

MARKET NEWS

Asian stocks tracked a steep Wall Street selloff on Thursday, as investors fretted over rising global inflation, China's zero-COVID policy, and the Ukraine war, while the safe-haven dollar held most of its strong overnight gains. 

Oil prices rose, recovering from early losses, as lingering fears over tight global supplies outweighed fears over slower economic growth as highlighted by slumping global shares. 

Reuters

Posted on: 2022-05-19T09:14:45+05:00

32819