Palm Oil Futures drop as prices at 7-month high spur selling

by **Cals** Thu 24 Oct 2013, 13:21

Palm Oil Futures drop as prices at 7-month high spur selling

Business & Markets 2013

Written by Bloomberg

Thursday, 24 October 2013 12:14

24 Oct 2013 12:04

(Oct. 24): Palm oil declined the most in a week after a rally to a seven-month high spurred some investors to lock in gains.

The contract for delivery in January retreated as much as 1.1 percent to 2,455 ringgit ($778) a metric ton on the Bursa Malaysia Derivatives, the biggest drop for the most-active futures since Oct. 17, and was at 2,460 ringgit at 11:43 a.m. in Kuala Lumpur. Palm for physical delivery in November was at 2,460 ringgit yesterday, data compiled by Bloomberg show.

Futures rallied for the fourth day yesterday to close at the highest level since March on speculation that output in Malaysia, the world’s second-largest producer, may increase at a slower pace and cap inventories. The commodity, used in everything from noodles to biofuels, has gained 6 percent this month, erasing losses this year.

“There has been some profit taking after the recent good run,” said Donny Khor, deputy director of futures and commodities at RHB Investment Bank Bhd. in Kuala Lumpur. “This is a breather before a bull run as the underlying market is looking positive on expectations of lower production.”

Soybeans for delivery in January were little changed at $13.0475 a bushel on the Chicago Board of Trade, while soybean oil for December slid 0.4 percent to 41.34 cents a pound.

Refined palm oil for May delivery was little changed at 6,176 yuan ($1,015) a ton on the Dalian Commodity Exchange and soybean oil fell 0.3 percent to 7,196 yuan.