JAKARTA: Malaysian palm oil futures were set for a second straight weekly drop on Friday, even as prices rose from a one-month low hit in the previous session, supported by recovery in some rival oils and good export data.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange climbed 1.25% to 3,982 ringgit ($889.34) a tonne by the midday break. But the contract has lost 2.71% so far in the week, which analysts attribute to global economic concerns amid fear of a US banking crisis.
“Today we are taking the opportunity to take profits on the back of strong Dalian and Chicago soyoil recoveries after recent sell off. Our own fundamental is supportive being good export and probable low production due to recent flooding,” a Kuala Lumpur-based trader said.
Exports of Malaysian palm oil products for March 1-15 rose between 55% and 72% from the same period in February, as shipments to India jumped ahead of the Muslim festival of Eid, according to cargo surveyors data.
Argentina’s Buenos Aires grains exchange slashed its 2022/2023 soy production forecast to 25 million tonnes, down sharply from the 29 million tonnes previously estimated, as the crop continues to be battered by a prolonged drought.
Palm oil snaps 3-day losing streak as demand surges
Dalian’s most active soyoil contract slid 0.39%, while its palm oil contract rose 1.42%. Soyoil prices on the Chicago Board of Trade were up 0.23%.
Palm oil may retest a support of 3,892 ringgit per tonne, a break below which could trigger a fall into a range of 3,810-3,856 ringgit, Reuters technical analyst Wang Tao said.
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