KUALA LUMPUR: Malaysian palm oil futures inched higher on Tuesday, reversing earlier losses, as bargain buyers emerged and short-covering activity provided additional support.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange rose 20 ringgit, or 0.47%, to 4,262 ringgit ($1,005.90) a metric ton at the midday break. The contract fell in the last two sessions.
Bargain buyers lifted crude palm oil futures prices to positive territory at the session’s close, a Kuala Lumpur-based trader said.
“It could be that some short coverings are pushing up the market,” the trader added.
Dalian’s most-active soyoil contract rose 1.4%, while its palm oil contract rose 0.76%. Soyoil prices on the Chicago Board of Trade were down 0.18%.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Palm extends losses on weak rival oils, concerns over rising output, stocks
Oil extended gains, lifted by hopes of improved economic activity after the U.S.-EU trade deal, a potential U.S.-China tariff truce and President Donald Trump’s shorter deadline for Russia to end the Ukraine war.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, weakened 0.21% against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.
Palm oil may fall to 4,161 ringgit per ton, as it has pierced below support at 4,211 ringgit, Reuters technical analyst Wang Tao said.
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