Palm gains over 1% on bargain buying; posts fourth monthly rise in 5 months

KUALA LUMPUR: Malaysian palm oil futures closed more than 1% higher on Friday, booking a fourth monthly rise in five, as bargain buying and firmer Dalian palm olein and Chicago soyoil supported prices.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange gained 66 ringgit, or 1.43%, to 4,682 ringgit ($1,155.19) a metric ton at the close.

The contract rose 1.56% this month after tumbling 5.8% in September, lifted by firmer crude oil prices and strong export demand, even as concerns over higher stockpiles weighed on prices.

Crude palm oil futures traded higher on the day following the recovery in Dalian palm olein and Chicago soyoil during Asian hours, said Anilkumar Bagani, head of research at Mumbai-based vegetable oil broker Sunvin Group.

“The prices also recovered on bargain buying with strong technical support seen below 4,600 ringgit for the benchmark January 2027 futures,” Bagani said.

Bagani added that the market’s focus has now turned to Malaysia’s October full-month palm oil export and production data scheduled for November 10, as well as the expected rise in stocks.

Dalian’s most-active soyoil contract rose 0.54%, while its palm oil contract added 0.9%. Soyoil prices on the Chicago Board of Trade were up 0.76%.

Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

Oil prices rose and were on track for a fourth monthly gain as traders braced for a potential escalation in the US-Iran conflict after US midterm elections, with an attack on a tanker in the Strait of Hormuz highlighting supply risks from the war.

Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.

The ringgit, palm’s currency of trade, strengthened 0.07% against the dollar, making the commodity more expensive for buyers holding foreign currencies.