Palm oil headed for the longest run of weekly losses since August as investors fretted about a strong rebound in Malaysian supply amid uncertain global economic conditions that could hurt demand for vegetable oils. Futures were down 5% this week by 3:00 p.m. in Kuala Lumpur, their third weekly drop and the biggest decline since early January. The tropical oil has lost 23% since its November peak and briefly dipped below the psychologically important level of 4,000 ringgit a ton in the afternoon trading session.“There’s so much uncertainty in the global macro-economy that nobody wants to take positions in the market even if they look attractive,” according to trader. Fears that supply in second-biggest grower Malaysia will make its usual season surge in coming weeks is weighing on investor sentiment, he said. Still, cheaper palm oil prices are stoking demand from price-sensitive markets like India, Pakistan and Bangladesh, trader said. While palm futures may dip to 3,850 to 3,900 ringgit, it will be temporary as those levels will attract bargain hunters, especially as the tropical oil is back to trading at a discount to rival soyoil, he said. (Source:Bloomberg)
