JAKARTA: Malaysian palm oil futures jumped on Thursday, erasing last session’s losses, tracking stronger rival edible oils.
Meanwhile, data from Malaysian Palm Oil Board (MPOB) showed a rise in March inventories.
The benchmark June palm oil contract on the Bursa Malaysia Derivatives Exchange gained 65 ringgit, or 1.57%, to 4,213 ringgit ($941.87) a metric ton by the midday break.
“The futures react to rival oils’ rise,” a Kuala Lumpur-based trader said, adding that the export data will provide cues into the way forward.
Malaysia’s palm oil stocks at the end of March rose 3.52%from the previous month to 1.56 million metric tons, data from the MPOB showed on Thursday.
A Reuters survey had forecast inventories at 1.56 million tons, with output seen at 1.31 million tons and exports at 1.02 million tons.
Dalian’s most-active soyoil contract added 0.74%, while its palm oil contract gained 1.39%. Soyoil prices on the Chicago Board of Trade (CBOT) rose 0.61%.
Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.
Palm oil rebounds to track Chicago soyoils, crude oil higher
Oil retreated as U.S. President Donald Trump ramped up a trade war with China even as he announced a 90-day pause on tariffs aimed at other countries.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, strengthened 0.47% against the U.S. dollar, making the commodity more expensive for buyers holding foreign currencies.
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