Palm oil up

Malaysian palm oil futures rose on Tuesday, up from a one-week low touched in the previous session, supported by a decline in the ringgit against the dollar. A weaker ringgit lent support to palm but earlier gains were limited due to higher production and slowing exports, said a trader based in Kuala Lumpur. The market later strengthened in the evening as some traders covered short positions despite expectations that sluggish demand would eventually weigh on prices, a dealer said.
The palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange gained 0.8 percent at 2,675 ringgit ($682) per tonne at the end of the trading day. It earlier fell for two consecutive days, seeing its sharpest decline since March 2 on Friday.
Traded volumes were 51,121 lots of 25 tonnes each, higher than a 2015 daily average of 44,600. Malaysia's ringgit, the currency palm oil is traded in, fell 0.5 percent to the dollar on Tuesday, making the vegetable oil cheaper for holders of foreign currencies. The ringgit fell to a one week low of 3.9495 per dollar before rising to trade around 3.9200 in the evening, following news of state investment fund 1Malaysia Development Berhad defaulting on a bond interest payment.
Slower shipments of Malaysian palm oil products are seen capping gains in benchmark prices after they registered flat to little growth in April 1-25 from a month earlier, cargo surveyor data shows. Palm oil may rise to 2,697 ringgit per tonne, as it has found a support around 2,650 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.
In competing oils, the September soybean oil contract on the Dalian Commodity Exchange fell 0.2 percent, while the May Chicago Board of Trade soyoil contract gained 0.2 percent. The offer price for crude palm kernel oil stood at 4877.71 ringgit per tonne on Tuesday evening, according to price assessments by Thomson Reuters.