Palm oil opens lower

Palm oil opens lower

LONDON (Reuters): News that Pakistan has suspended all foreign currency transactions amid the world-wide outcry over its nuclear tests hit opening palm oil prices in Europe yesterday.

Crude palm oil opened $15 to $7.50 lower with products down a similar amount, but traders said the market is quiet ahead of the holiday weekend in most of Europe.

Traders said that a curb on foreign currency trading would mean that Pakistan would not easily be able to obtain U.S. dollars and would not be able to pay for any new shipments of palm oil from Malaysia. It not may even be unable to honor letters of credit for earlier transactions.

Only a couple of early trades were reported when early June olein fetched $670 and $665 a ton fob Malaysian ports.

All other sectors of the market were featureless at the opening with coconut oil unchanged to $5 down while Malaysian/Indonesian palmkernel oil was $35 up.