Malaysian palm oil futures inched higher on Tuesday, with traders expecting more upbeat outlooks from participants at an industry conference this week. The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange closed up 0.5 percent at 2,160 ringgit ($530) a tonne.
Prices are likely to be supported in 2019, leading palm industry analyst James Fry said on Tuesday, supported by rising consumption, falling inventories and slowing growth in production of the edible oil. "The market is expecting bullish outlooks tomorrow," said a Kuala Lumpur-based futures trader, referring to price forecasts scheduled to be delivered by leading analysts at a palm industry conference on Wednesday.
Another trader said earlier in the day that the market was likely to hold at current levels as production was coming off in the short term. Palm oil output typically falls on a monthly basis in the first quarter in line with seasonal trend. Crop-friendly weather over the last few months in Indonesia and Malaysia will help drive up output of the edible oil this year, traders and industry players said, though reduced usage of fertiliser, labour shortages and older trees could limit output growth.
Market players also said global demand for palm oil may decline for the first time in two decades during the 2019/20 crop year due to rising domestic oilseed supplies in top buyer India and slowing demand in Europe and China. In other related oils, the Chicago March soyabean oil contract was last up 0.2 percent.
US soyabeans rose for a third consecutive session on Tuesday, as an expected trade agreement between Washington and Beijing stoked hopes of increased demand for North American oilseeds. The May soyaoil contract on the Dalian Commodity Exchange declined 0.2 percent and the Dalian May palm oil contract fell 0.5 percent. Palm oil prices are affected by movements in soyaoil, as they compete for a share in the global vegetable oil market.
Comments
Comments are closed for this article.