Palm edges up, tracking rival oils as Argentine exports slow

KUALA LUMPUR: Malaysian palm oil futures rose on Thursday, buoyed by gains in rival oils on the Dalian Commodity Exchange and Chicago Board of Trade as markets worried about tight Argentine supplies due to labour strikes.

The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange rose 34 ringgit, or 1%, to 3,569 ringgit ($879.28) a tonne to post a second straight weekly gain.

Earlier in the session, the contract climbed as much as 1.8%, building on Wednesday's 3.6% jump, which was the biggest since late October.

Argentine oilseed workers and grains inspectors said on Wednesday they would spend Christmas on strike, further bogging down agricultural exports by extending a work stoppage that started on Dec. 9.

CBOT soyoil climbed 1.3%, while soy and palm oils on the Dalian Commodity Exchange rose 3.5% and 5.2%, respectively.

Palm oil futures are seen trading higher after a strong technical breakout following the "blistering rally" in CBOT soy oil and in South American cash markets, said Anilkumar Bagani, research head at Mumbai-based vegetable oil broker Sunvin Group.

"However, a stronger ringgit and low export demand for January so far have restricted palm oil prices to move past 3,600 ringgit for the time being," Bagani said.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market. A stronger ringgit makes the commodity less attractive to foreign currency holders.

Palm oil may break a resistance at 3,552 ringgit per tonne, and rise to 3,631 ringgit, as the surge on Wednesday confirmed a continuation of the uptrend, Reuters market technicals analyst Wang Tao said.