Weak trend in edible oils on global cues, subdued demand

NEW DELHI: Amid weak trend in Malaysian palm oil and subdued domestic demand, select edible oils drifted in the wholesale oils and oilseeds market in the national capital during the past week.

Bucking the trend, mustard expeller oil showed some strength on the back of pick up in demand from retailers.

Market analysts attributed fall in edible oil prices in the domestic market to weakness in Malaysian palm oil futures, which plunged to a 18-month low on concern that the 700-bn dollar bailout package for troubled financial institutions would not stimulate economic growth and demand for commodities.

They said reports of 19 per cent fall in Malaysian palm oil exports in September to 1.2 million tonnes too had downward effect on the prices.

December delivery of palm oil fell 4.3 per cent to 2,000 ringgit (577 dollar) a tonne on the Malaysia Derivatives Exchange.

Meanwhile, Malaysia's palm oil exports fell 19 per cent in September to 1.2 mn tonnes against the previous month. Indonesia and Malaysia account for 90 percent of the world's palm oil production.

Palmolein (RBD) after showing some strength at the outset of the week, slipped back on stockists selling,triggered by weak global markets and closed the week Rs 70 down at Rs 4,700 per quintal, while Crude palm oil (ex-kandla) suffered a steep fall of Rs 430 at Rs 3,100 per quintal.