Palm slides for fourth session on weaker rival oils, crude oil

KUALA LUMPUR: Malaysian palm oil futures edged lower for a fourth straight session on Wednesday, pressured by weaker rival edible oils and crude oil prices.

The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange slid RM25, or 0.52 per cent, to RM4,785 (US$1,175.96) a metric ton in early trade.

Oil prices drifted lower as Saudi Arabia began restoring crude supply on a critical pipeline to the Red Sea and on hopes for a diplomatic solution to the US-Iran war through talks at the UN in New York.

Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

Dalian's most-active soyoil contract fell 0.38 per cent, while its palm oil contract shed 1.41 per cent. Soyoil prices on the Chicago Board of Trade were down 0.82 per cent.

Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

European Union soybean imports for the 2026/27 season that began in July had reached 2.67 million tons by September 20, down 14 per cent from a year earlier, while palm oil imports fell 26 per cent to 0.56 million tons, European Commission data showed.

Indonesia is expected to experience a shorter-than-usual rainy season starting in November this year, the weather agency said, which could impact crops as farmers adjust their planting schedules.

Agropalma, Brazil's leading palm oil producer, expects output in the new crop cycle to rise by about 20 per cent versus last year, which was negatively affected by the El Niño weather event in 2023-24.

Palm oil may break support at RM4,799 per ton, and fall towards the RM4,732 to RM4,766 range, Reuters technical analyst Wang Tao said.

Asian shares were aiming for a sixth session of gains as signs of consumer demand for AI apps continued to buoy tech stocks, while oil prices faltered on reports of increased supply out of the Middle East.