Palm sees strongest gain in a week on weaker ringgit

KUALA LUMPUR: Malaysian palm oil futures charted their strongest daily gains in a week on Wednesday, pulling out of earlier range trading thanks to losses in the ringgit and a recovery in US soyoil on the Chicago Board of Trade.

The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange was last up 0.6% at 2,253 ringgit ($537.71) per tonne at the close of trade, its strongest gain in a day since Aug. 22 and its sixth day of gains in seven.

Palm earlier fell as much as 0.6% to a four-day low of 2,225 ringgit. It had declined over 1% in its previous session, snapping five straight days of gains.

"The market is up on the ringgit, while US soyoil is also up," said a Kuala Lumpur-based trader.

A weaker ringgit, palm oil's currency of trade, supports the vegetable oil by making it cheaper for foreign buyers. The ringgit eased 0.2% against the dollar on Wednesday evening at 4.2110, near its weakest levels in nearly two years.

In other related oils, US soyoil futures on the Chicago Board of Trade fell 1.1% on Tuesday, but have since recovered and were last up 0.1%.

US soybean futures had retreated on Tuesday on improving crop prospects and a lack of progress in trade talks with China, the world's top importer of the oilseed, traders said.

Meanwhile, the September soyoil contract on the Dalian exchange declined 1.6%, while the Dalian September palm oil contract was down 1.6%.

Palm oil prices are affected by movements in related oils, as they compete for a share in the global vegetable oils market.