Palm Oil Slumps to Three-Year Low as Crude Oil Extends Decline

By Glenys Sim

Oct. 24 (Bloomberg) -- Palm oil futures in Kuala Lumpur slumped as much as 12.4 percent to the lowest in more than three years as crude oil tumbled on speculation an OPEC output cut would fail to stem price declines.

Palm oil for January delivery fell to 1,358 ringgit ($379) a ton on the Malaysia Derivatives Exchange, the lowest since August 2005. Futures traded at 1,367 ringgit at 5:35 p.m. in Singapore.

The edible oil, used mainly in food, tracks crude oil as analysts consider it viable for use as a biofuel when oil rises above $80 a barrel. Crude in New York fell as much as 7.1 percent after OPEC agreed to cut production by 1.5 million barrels a day from November.

To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net