JAKARTA: Malaysian palm oil futures extended gains to a second session on Wednesday, as lower-than-expected stockpiles and strength in related oils helped lift prices.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange climbed 1.65% to close the afternoon trade at 3,950 ringgit ($900.18) per tonne, after gaining 4% on Tuesday.
Palm rose as a “continuation of bargain-buying from yesterday reinforced by bullish MPOB data,” said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Malaysia’s palm oil stocks at the end of November fell for the first time in six months, as production slumped amid a slight pick-up in exports, data from the Malaysia Palm Oil Board (MPOB) showed on Tuesday.
The stock fell 4.98% from October, deeper than the 0.47% decline expected in a Reuters poll.
Palm oil imports to India, the world’s biggest buyer, rose in November by 29% from the previous month as steep discounts to rivals soyoil and sunflower oil made purchases lucrative for local refiners, a trade body said on Wednesday.
Also helping palm oil up were the higher related oils.
Dalian’s most active soyoil contract ended 1.29% higher, while its palm oil contract climbed 1.54%. Soyoil prices on the Chicago Board of Trade fell 0.90% after posting a 3.09% gain overnight.
Palm oil is affected by price movements in related oils, as they compete for a share in the global vegetable oils market.
Exports of Malaysian palm oil products for Dec. 1-10 rose 15.7% to 473,086 tonnes compared to shipments in Nov. 1-10, cargo surveyor Societe Generale de Surveillance said on Tuesday.
Meanwhile, crude palm oil output by rival Indonesia is seen at 48.1 million tonnes in 2023, up from an estimated 46.5 million tonnes this year, according to an industry group forecast.
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