KUALA LUMPUR: Malaysian palm oil futures ended at their highest in two weeks on Friday and booked their first weekly gain in three, as stronger rival Dalian oils boosted the market.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange gained 50 ringgit, or 1.24percent, to 4,087 ringgit (USD1,010.38) a metric ton, its highest closing price since December 9. The contract rose 4.66percent this week.
The market posted a strong rally, tracking strength in Dalian oils even as the ringgit strengthened 0.17 percent to 4.0360 at the midday break, a Kuala Lumpur-based trader said.
Dalian’s most-active soyoil contract rose 0.67 percent, while its palm oil contract gained 0.28 percent. Soyoil on the Chicago Board of Trade will reopen at 1430 GMT after being closed for Christmas on Thursday. 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 0.05 percent against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.
Oil prices were stable as investors weighed potential supply risks from developing geopolitical tensions in a thinly-attended post-Christmas session, after the US carried out airstrikes against Islamic State militants in Nigeria and added greater economic pressure on Venezuelan oil.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock. Meanwhile, Indonesia has identified potential fines amounting to USD8.5 billion that the government could collect in 2026 from palm oil companies and miners operating illegally in forest areas, the country’s attorney general said.
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