KUALA LUMPUR: Malaysian palm oil gave up its early gains on Thursday, declining towards the end of the trading day as rallies of rival vegetable oils on China’s Dalian Commodity Exchange slowed and palm export demand weakened.

Benchmark palm oil futures for January on the Bursa Malaysia Derivatives Exchange fell 0.5 percent to 2,718 ringgit ($650) a tonne on Thursday evening.

Traded volumes stood at 46,212 lots of 25 tonnes each at the end of the trading day.

Palm climbed to its highest levels in two-and-a-half years on Tuesday before dropping sharply on a correction in late session.

Palm was up on Thursday morning, tracking a surge in palm and soyaoil on Dalian, as they both hit over two-year highs.

Chinese commodities surged on Monday on short-covering over new regulatory rules to curb risk and speculation in structured products, which had pumped billions of dollars into the commodity futures markets.

Palm oil prices are impacted by the movements of related oils such as palm olein and soyaoil futures, as they compete for a share in the global vegetable oils market. Dalian gains softened in the evening, helping to drag down palm prices. The January soyabean oil contract on China’s Dalian Commodity Exchange rose 0.5 percent, while the January contract for palm olein on China’s Dalian Commodity Exchange gained 0.3 percent.

“Dalian came off towards the evening, and exports were down from cargo surveyor data,” said a trader from Kuala Lumpur, referring to data releases from Intertek Testing Services and Societe Generale de Surveillance on Thursday.

Palm oil shipments from Malaysia fell about 12 percent from Oct. 1-20 period from the corresponding period in the previous month.

In other related oils, the December soyabean oil contract on the Chicago Board of Trade was down 0.4 percent.—Reuters