PALMOILMAGAZINE, SINGAPURA – Palm oil futures contract prices on the Bursa Malaysia continued their second consecutive session of decline on Tuesday, October 31, 2023, following a drop in exports and concerns regarding demand.
As reported by Reuters, the benchmark futures contract for palm oil with the code FCPOc3 for April 2024 delivery on the Bursa Malaysia Derivatives Exchange decreased by RM 63, marking a decline of approximately 1.7%, to reach RM 3,674 (US$ 772.34) per metric ton during morning trading.
This contract has now recorded a loss of 2.4% for the month, heading for its second consecutive monthly decline.
Also Read : 2% Drop in CPO at Malaysian Exchange Amid Soyoil Harvest
According to the report from Gabungan Pengusaha Kelapa Sawit Indonesia (GAPKI), total exports for August 2023 reached 2.073 million tons, which is a 41% decrease compared to July 2023 when exports were 3.519 million tons. The decline in exports is primarily attributed to lower production, while domestic consumption remains consistently high.
Furthermore, there was an unexpected contraction in Chinese manufacturing activity in October, according to an official factory survey on Tuesday.
Still according to Reuters, soybean contract prices on the Dalian Commodity Exchange (DCPcv1) registered a 2.9% drop, while soybean oil contracts (DBYcv1) fell by 1.5%. Soybean oil prices on the Chicago Board of Trade (BOcv1) also decreased by 0.2%.
Also Read : CPO Prices on Malaysia Exchange Drop by RM 36 per Ton on Thursday
The U.S. soybean harvest continues to make progress beyond the average pace, even after rain last week. Farmers had harvested 85% of their soybean crop by Sunday, in line with the average analyst estimate and exceeding the five-year average of 78%. This rapid harvest rate is likely to boost the supply of soybeans and their products, including soybean oil.
Palm oil is influenced by the price movements of other vegetable oils as they compete for a share of the global vegetable oil market. (T2)
