JAKARTA: Malaysian palm oil futures hit a one-week high on Monday and closed higher for a second straight session, tracking gains in Chicago edible oils, while advances in the energy complex added further support.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange gained 104 ringgit, or 2.57percent, to 4,146 ringgit (USD1,056.57) a metric ton at the close. “Bursa Malaysia CPO futures opened higher, tracking price spreads in rival oilseeds,” a Kuala Lumpur-based trader said, adding that gains in the energy complex were supporting sentiment, as “supply-risk concerns intensify amid escalating tensions in the Middle East, threatening one of the world’s most critical energy corridors.”
Dalian’s most-active soyoil contract was up 0.41percent, while its palm oil contract rose 1.62percent. Soyoil on the Chicago Board of Trade added 2.55percent.
Palm oil tracks the price movements of rival edible oils as it competes for a share of the global vegetable oils market. Oil surged 9percent on Monday after retaliatory Iranian attacks disrupted shipping in the crucial Strait of Hormuz following the weekend’s bombing by Israel and the United States that killed Iranian Supreme Leader Ali Khamenei.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock. Meanwhile, Indonesia has raised its crude palm oil exports levy to 12.5percent of the CPO reference price from 10percent, a finance ministry regulation showed.
The move, officials said, aims to finance its biodiesel blending mandate.
Exports of Malaysian palm oil products fell 21.5percent in February compared to January, cargo surveyor Intertek Testing Services said. According to independent inspection company AmSpec Agri Malaysia, exports fell 25.5percent.
Indonesia exported 2.24 million metric tons of crude and refined palm oil in January, up 77.07percent year-on-year, statistics bureau data showed on Monday, with shipments valued at USD2.29 billion.
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