Palm oil snaps losing streak on improved demand

KUALA LUMPUR: Malaysian palm oil futures snapped four earlier sessions of losses to gain on Monday evening on the back of improved demand and a market retracement, according to traders.

The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 0.7 percent at 2,173 ringgit ($537.87) a tonne at the close of trade, its strongest daily gain in over two weeks.

Trading volume stood at 48,843 lots of 25 tonnes each at the close of trade.

Palm oil prices fell to a three-year low in the previous session, tracking weakness in edible oils and falling demand.

However, the low prices have spurred some buying interest, said a Kuala Lumpur-based futures trader.

"Prices are up likely on bargain-buying, given the recent low prices," he said, while another trader added that palm is also up on a market retracement after last week's losses, which saw palm shed 5.3 percent for the week.

Malaysia palm oil exports fell 2.7 percent in the first half of July versus the previous month, according to data from inspection company AmSpec Agri Malaysia on Monday. This compares with a 14.4 percent decline for the July 1-10 period.

Meanwhile, cargo surveyor Societe Generale de Surveillance reported a 8.8 percent decline in Malaysian palm oil exports for the July 1-15 period, versus a 23.1 percent fall in the June 1-10 period.

In other related oils, the Chicago December soybean oil contract fell 0.9 percent, while the September soybean oil contract on China's Dalian Commodity Exchange dropped 0.4 percent.

Meanwhile, the Dalian September palm oil contract was up 0.7 percent.

Palm oil prices are usually impacted by the performance of other edible oils as they compete for a share in the global vegetable oils market.