European palm oil prices slipped on Thursday, as a stronger ringgit currency weighed on Malaysian palm oil futures. Asking prices for RBD palmolein dipped between $15 and $17.50, with the January-March delivery easing to $547.50 per tonne. That position last traded at prices between $550 and $548 per tonne, slightly above the market. Palmkernel oil (PKO) extended losses from the previous two sessions after rallying sharply earlier in the week. All positions were down $30 to $35 and the November-December shipment last traded at $790 per tonne, on par with asking prices.
Crude palm oil (CPO) prices were also cut, with most positions down by as much as $20. The November position slid $15 to $532.50 per tonne. The European market tracked Malaysian futures, which eased on a stronger local currency. A lift in the ringgit pressures prices because it makes palm oil denominated in the currency more expensive for international buyers. The benchmark December palm oil contract closed down 2.9 percent on Thursday, after two weeks of mostly steady gains.
Coconut oil tumbled in sympathy with palm, as positions slid by as much as $50. The front October-November stock was traded at prices between $1,020 and $1,000 per tonne. Traders said the sharp drop in coconut oil prices represented a correction, after a recent rally on the back of anxiety about the impact of El Nino. “It’s partly sentiment and partly that copra prices are dropping, definitely in Indonesia and also in the Philippines,” said one European trader. “Yes, El Nino is there but so far the rains are more than sufficient. If we do have effects of El Nino, it will be much, much later.” Rapeseed oil broadly followed other oils, with most positions dipping by up to 5 euros. The February-April last traded at 676 euros per tonne, in line with asking prices.
