Palm extends gains on stronger Dalian oils, weaker ringgit

JAKARTA: Malaysian palm oil futures rose for a third straight session on Wednesday, supported by gains in rival Dalian oils and a weaker ringgit.

The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange climbed 0.43% to 4,166 ringgit ($980.00) by the midday break. It had gained 2.12% in the previous two sessions.

Palm was supported by good gains in Dalian’s RBD palm olein and a continued depreciation of the local currency, said a Kuala Lumpur-based trader.

Dalian’s most-active soyoil contract gained 0.30%, while its palm oil contract climbed 1.52%.

Soyoil prices on the Chicago Board of Trade slid 0.54% Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

The ringgit, palm’s currency of trade, weakened 0.33% against the dollar, making the commodity cheaper for buyers holding foreign currencies.

Palm oil may test resistance at 4,195 ringgit per ton, a break above which could lead to a gain into the 4,219 ringgit to 4,233 ringgit range, Reuters technical analyst Wang Tao said.

Meanwhile, an Indonesian palm oil group said on Tuesday the country’s exports to the United States may fall due to the 32% tariffs threatened on Indonesian goods, allowing competitors in Malaysia to gain market share as they face lower tariffs.