Palm oil edges up on stable ringgit, technical rebound

KUALA LUMPUR: Malaysian palm oil futures edged up in early trade on Wednesday on support from a stable ringgit and a technical rebound after a fall to a more than four-month low in the previous session.

Palm oil slid in its last two sessions due to a strengthening ringgit, which makes the tropical oil more expensive for holders of foreign currencies and lowers demand.

The ringgit, whch rose to its highest since September 2016 against the dollar on Tuesday, was little changed in Wednesday's trade around noon. It was last up just 0.02 percent at 4.0650 ringgit to the dollar.

The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange was up 0.2 percent at 2,568 ringgit ($631.73) a tonne at the midday break, in line for a first gain in three days.

Palm, however, is down 1.3 percent so far this week, on track for a sixth week of losses.

Traded volumes stood at 10,991 lots of 25 tonnes each at noon.

"Palm is up as the ringgit seems stable," said a Kuala Lumpur based trader, adding that overnight gains in soyoil on the Chicago Board of Trade also provided support to palm.

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

The January soybean oil contract on the Chicago Board of Trade added 0.2 percent in its previous session, but was last down 0.2 percent in trade on Wednesday.

In other related oils, the January soybean oil contract on the Dalian Commodity Exchange fell 0.2 percent, while the Dalian January palm olein contract declined 0.4 percent.