Malaysian palm oil futures snapped a three-week rally on Friday, pressured by weakness in rival edible oils, while traders closed their positions ahead of a long weekend.

The benchmark palm oil contract FCPO1! for November delivery on the Bursa Malaysia Derivatives Exchange slid 72 ringgit, or 1.62%, to 4,377 ringgit ($1,040.90) a metric ton at the close. The contract fell 3.36% this week.

Overnight weakness in rival oilseeds spilled over to palm oil futures, with some market players possibly closing positions ahead of the long weekend, a Kuala Lumpur-based trader said.

The Malaysian bourse and the Chicago Board of Trade will be closed on Monday for a public holiday.

Dalian’s most-active soyoil contract (DBYcv1) fell 0.38%, while its palm oil contract CPO1! shed 1.69%. Soyoil prices on the Chicago Board of Trade ZL1! were down 1.05%.

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

Oil prices fell, but were set for a weekly gain, tugged between uncertainty about Russian supply and expectations of lower demand as the summer driving season in the United States, the world’s biggest fuel consumer, nears its close. O/R

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

The ringgit USDMYR, palm’s currency of trade, weakened 0.19% against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.
Source: Reuters