Palm oil prices ‘to recover’, after 7% plunge
Palm oil prices, which plunged nearly 2% to a two-year low on Monday, are poised to recover, commentators said – but differed on the timescale, with ANZ saying a revival may take until late this year.
Palm oil prices, as measured by the December futures contract in Kuala Lumpur, plunged 6.7% to 2,577 ringgit a tonne in early deals in Kuala Lumpur, the lowest for a benchmark lot since September 2010.
The drop was blamed in part on broader market factors such as a decline in crude oil prices, to which values of palm oil, as a biodiesel feedstock have a tie, and to economic concerns, especially in leading import markets such as China and Europe.
“We are seeing tensions between Japan and China,” sparked by claims to the Senkaku islands, Ker Chung Yang, at Singapore-based Phillip Futures, told Agrimoney.com, flagging also continued concerns over eurozone debt.
Furthermore, elsewhere in the oilseeds complex, Chicago soybeans extended their losses on Monday, with the benchmark November lot falling below $16 a bushel for the first time in a month.