Malaysian CPO futures in tumbled for the 2nd day as a drop in rival soybean oil and a bearish outlook from a leading analyst unsettled the market. Palm oil for Novdelivery fell as much as 5.2% to 2,465 ringgit a tonne.
Palm oil, the world's most consumed vegetable oil, declined after Dorab Mistry, director at Godrej International Ltd., said yesterday that prices must fall to 2,200 ringgit (US$653) a tonne in the next few weeks for demand to rebound.
The edible oil slumped as "someone with that caliber turned bearish" and "soybean oil also fell," Kan Heen Sing, trader at HLG Futures Sdn., said today from Kuala Lumpur.
Futures fell to a 15-month low last week as supplies from Malaysia and Indonesia outpaced demand for food, and as weaker crude oil lowered its attraction as a biofuel. Global demand for vegetable oils may expand 6.5 m tons in the year from Oct, less than the 6.8 m ton increase in supplies, Mistry said.
The benchmark futures at 2,500 ringgit is an "important psychological level," Kan at HLG said. "If that level gets broken, we might see prices decline further to find some support around 2,350 ringgit."
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