Palm oil snapped a four-day rally on speculation that shipments from Malaysia may drop after Indonesia, the world’s largest producer, cut export taxes.
The contract for July delivery declined as much as one per cent to RM2,293 (US$757) a metric tonne on the Bursa Malaysia Derivatives and ended the morning session at RM2,296 in Kuala Lumpur. Futures gained 0.9 per cent last week, the first such advance since the five days ended March 22.
Indonesia cut the tax on crude palm oil exports to nine per cent in May from 10.5 per cent this month, Bachrul Chairi, director general for foreign trade at the Trade Ministry, said April 26.
Malaysia will keep the tax unchanged at 4.5 per cent. Exports from Malaysia increased 2.7 per cent to 1.08 million tonnes in the first 25 days of this month from the same period in March, surveyor Societe Generale de Surveillance said April 25.
“Malaysia may lose out on the export tax front,” said Ker Chung Yang, an analyst at Phillip Futures Pte. in Singapore. “Export numbers for the next couple of months are going to be not that impressive. The high stockpile story is going to haunt us again.”
Reserves have dropped 17 per cent to 2.17 million tonnes in March from a record 2.63 million tonnes in December, according to Malaysian Palm Oil Board data.
Soybean oil for July delivery gained 0.5 per cent to 49.78 cents a pound on the Chicago Board of Trade, while soybeans advanced 0.4 per cent to US$13.865 a bushel. — Bloomberg
Source : The Borneo Post