Palm oil falls for a second session on weak rival oils

Malaysian palm oil futures declined for the second day in a row on Monday, following a similar trend among comparable vegetable oils on Chicago and Dalian exchanges. The December palm oil contract on the Bursa Malaysia Derivatives Exchange slipped 9 ringgit, or 0.19%, to 4,663 ringgit ($1,142.05) per metric ton at the day's close.

The price fluctuated between 4,642 ringgit and 4,720 ringgit, following a 4.61% decline last week. A trader in Kuala Lumpur stated that the contract was buoyed by strong crude oil prices and a weaker ringgit, but strong Dalian and Chicago oils limited gains. Dalian's leading soyoil contract shed 0.84%, while its palm oil contract dropped 1.6%.

Palm oil prices mirror those of rival edible oils, as they vie for a piece of the global vegetable oils market. Meanwhile, Brent crude rose over 3% on Monday after US President Donald Trump rejected a proposed peace deal from Iran to resolve their dispute and reopen the Strait of Hormuz. Palm oil becomes a more appealing choice for biodiesel feedstock when crude oil prices climb.

The weakening of the ringgit, down 0.25% against the dollar, made the commodity a bit more affordable for buyers who hold foreign currencies. Analyst Wang Tao from Reuters projected that palm oil prices could continue to fall in the range of 4,588-4,622 ringgit per ton. Malaysian palm oil exports for September 1-25 are estimated to have fallen between 15.1% and 24.3% compared to the previous month, according to cargo surveyors Intertek Testing Services and AmSpec Agri Malaysia.

Indonesia's palm oil exports in July were 3.19 million metric tons, a 9.87% decrease from the same period in the previous year, as reported by the palm oil association GAPKI on Monday.