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Markets

Palm hits over 1-month high on U.S. soyoil strength

KUALA LUMPUR: Malaysian palm oil futures climbed over 1% at midday break on Wednesday to their highest in more than a mo

July 24, 2019

KUALA LUMPUR: Malaysian palm oil futures climbed over 1% at midday break on Wednesday to their highest in more than a month, tracking gains in U.S. soyoil on the Chicago Board of Trade (CBOT).

The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 1.1% at 2,026 ringgit ($491.87) per tonne at noon, heading for a third straight session of gains.

Earlier in the session, it rose as much as 1.2% to 2,028 ringgit, its strongest levels since June 21.

Palm oil may rise more to 2,023 ringgit per tonne, as it has cleared a resistance at 2,001 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

"Palm futures prices opened higher taking cue from continuous gains in competing vegetable oils," said a Kuala Lumpur-based trader.

U.S. soyoil futures on the CBOT gained 1% in the previous session, and were last up 0.4%, as of 0430 GMT.

U.S. soybeans rose on Tuesday on hopes China could buy U.S. supplies. Grain prices held steady on Wednesday as fears about widespread yield losses due to recent adverse U.S. weather conditions underpinned the market. In other related oils, the September soyoil contract on the Dalian exchange rose 1.1% and the Dalian September palm oil contract gained 1.8%.

Palm oil prices are affected by movements in related oils that compete for a share of the global vegetable oils market.

Copyright Reuters, 2019