SINGAPORE: Malaysian palm oil futures edged higher on Wednesday, extending their climb for a second session, as the benchmark contract tracked gains in rival vegetable oils.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange rose 21 ringgit, or 0.55%, to 3,810 ringgit ($860.05) by the midday break. In the previous session, the contract had posted its biggest daily gain since December.
Dalian’s most-active soyoil contract edged 0.13% higher, while its palm oil contract rose 1.79%. Soyoil prices on the Chicago Board of Trade were down 0.29%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
The market is taking a breather after two days of hefty gains.
Profit-taking and some squaring of positions could play into a lower market ahead of the long weekend, said Sathia Varqa of Fast Markets Palm Oil Analytics.
Meanwhile, Malaysia’s exports in March fell 1.4% on the year, a smaller decline than analysts expected, government data showed on Wednesday.
Exports of Malaysian palm oil products for April 1-15 fell 20.7% to 566,995 tonnes from 715,230 tonnes shipped during March 1-15, cargo surveyor Societe Generale de Surveillance said.
Palm oil marks great day amid supply concerns
Traders are assessing whether the Black Sea grain corridor deal would be extended beyond May 18 after recent concerns.
The ringgit, palm’s currency of trade, fell 0.05% against the dollar, making the commodity cheaper for holders of foreign currency.
Palm oil may extend gains into a range of 3,864-3,934 ringgit per tonne, Reuters technical analyst Wang Tao said.
In global markets, stocks sagged in cautious trade on Wednesday, while the dollar paused its recent decline as expectations for an imminent peak in the Federal Reserve’s interest rate cycle edged ahead of US banking sector concerns.