CPO Benchmark Futures Price Softens in Malaysia

Kuala Lumpur: Malaysia’s crude palm oil (CPO) benchmark futures price declined for the fourth consecutive session, pressured by weaker prices of rival edible oils and crude mineral oil.

During early trading on the Bursa Malaysia Derivatives (BMD) Exchange in Kuala Lumpur, the CPO futures price for December delivery fell by 25 ringgit, or 0.52%, to 4,785 ringgit ($1,175.96) per tonne.

According to trade analysts, Saudi Arabia has resumed crude mineral oil supplies through a key pipeline via the Red Sea. There are also expectations that negotiations could help ease tensions between the United States and Iran. Softer crude oil futures have made palm oil less attractive for biodiesel production, putting pressure on prices. This situation may persist for some time.

Meanwhile, on the Dalian Commodity Exchange in China, the most-active soybean oil futures contract fell 0.38%, while palm oil futures declined 1.41%. On the Chicago Board of Trade (CBOT), soybean oil futures also fell 0.82%.

In the European Union, soybean imports during the current marketing season, from July 1 to September 20, stood at 2.67 million tonnes, down 14% from imports during the corresponding period last year. During the same period, palm oil imports also declined 26% to 560,000 tonnes.

In Indonesia, lower-than-normal rainfall is expected, which could affect oil palm production.