Palm Oil Records Biggest Drop in 8-Days

PALM oil posted the biggest drop in eight days yesterday as crude oil

slumped and soybeans declined, reducing demand for the tropical

commodity used in food and biofuels.

The September-delivery

contract fell as much as 1.5 per cent to RM2,363 a metric ton on the

Malaysia Derivatives Exchange.

Palm oil has fallen about 7.3 per

cent this quarter on forecasts for record output of world oilseed crops

and was at RM2,367 at 4.05 pm.

“The mid-term technical outlook is still pointing down,” said Ryan Long,

a futures trader at OSK Investment Bank.

“The immediate downside

target is RM2,350 a ton, he added.

The “grossly bearish”

technical charts for palm oil signal prices falling to between RM1,990

and RM2,200 a ton, a RHB Research Institute report on Monday said.

Crude

oil in New York slumped 2 per cent to US$76.67 a barrel in European

trading on concerns slower economic growth may curb energy demand and

skepticism that production from Gulf of Mexico wells will be disrupted

by a tropical storm.

November-delivery soybeans in Chicago fell

0.3 per cent to US$9.16 a bushel.

Soybean prices may come under

more pressure “with no corn rally in sight,” Scott Briggs, an

agricultural commodities strategist at Australia & New Zealand

Banking Group Ltd, said yesterday.

Corn for December delivery in

Chicago declined 0.4 per cent to US$3.515 a bushel, falling for the

seventh straight day, the longest slump since March.

Vegetable

oils oil often track crude oil movements as it can be used in biofuels.

Source : Business Times

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