Palm oil on the European vegetable oils market firmed on Wednesday following soaring energy markets on news that Opec had finalised a deal to cut production. Palm oil was offered between $5 and $15 a tonne up from Tuesday. Malaysian palm oil futures closed between 12 and 23 ringgit per tonne higher, reversing course to gain in late trade as they tracked a rally in energy prices. Futures declined earlier in the session because of poor Malaysian palm oil export numbers for November.
"The news about Opec cutting production was bullish to several vegetable oils as higher mineral oil prices would probably mean more demand from biodiesel producers for vegetable oils," one broker said. At 1730 GMT CBOT soyaoil futures were between 0.29 and 0.44 cents per lb up on the back of the rally in energy markets. Lower Chicago soyabeans, because of end-of-month positioning and a brighter US oilseed outlook, curbed gains slightly.
EU rapeoil was mostly offered between nine and 12 euros per tonne higher, following stronger Chicago soyaoil and supported by soaring energy prices. Firmer rapeseed futures, on hopes that an Opec deal will boost demand from biofuels makers, also aided to the strength in rapeoil. Coconut oil, which is less vulnerable to news about energy markets as it is used less in biofuels than palm and rapeoil, was offered between $5 up and $5 down from Tuesday. Front positions palmkernel oil gained as much as $30 a tonne on continued concerns over tight nearby supplies with little unsold material due to arrive in Europe. More deferred positions lost some ground with offerings between $5 and $10 lower.
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