Palm heads for second monthly gain on tight supply concerns

JAKARTA: Malaysian palm oil futures were on track for a second straight monthly gain amid concerns about tight supply as prices rose on Friday after two sessions of falls in a row.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange gained 0.93% to 4,975 ringgit a tonne in early trade, after shedding 1.66% in the previous two sessions. For the month, it was up about 8.4%.

Fundamentals

• Dalian's palm oil contract gained 1.61%, while its most-active soyoil contract rose 1.09%. Soyoil prices on the Chicago Board of Trade rose 0.20%.

• Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

  • Palm oil may test a resistance at 5,048 ringgit per tonne, as it has stabilised around a support at 4,822 ringgit, Reuters technical analyst Wang Tao said.