JAKARTA: Malaysian palm oil futures closed up on Wednesday after six straight sessions of losses, underpinned by a weaker ringgit and stronger rival oils.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange gained 45 ringgit, or 1.16%, to 3,917 ringgit ($862.59) per metric ton on the closing.
Dalian’s most-active soyoil contract rose 2.16%, while its palm oil contract surged 2.35%. Soyoil prices on the Chicago Board of Trade were down 0.11%.
“Overnight recovery in the soybean complex and strong support from Dalian palm olein lifted BMD FCPO prices,” said a Kuala Lumpur-based trader.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Indonesia has set its crude palm oil reference price at $826.48 per metric ton for Aug. 1-15, keeping the export tax and levy unchanged from the previous period.
Malaysia’s benchmark crude palm oil prices will trade in 3,700-4,200 ringgit a metric ton range in the second half of 2023, and will remain supported in the long term, state agency Malaysian Palm Oil Council said.
Malaysia’s palm oil exports for July rose 7.8% from the month before, according to AmSpec Agri Malaysia, while cargo surveyor Intertek Testing Services (ITS) estimated a 14% rise for the same period.
India’s average monthly edible oil imports in the 2021/22 marketing year were 1.17 million tonnes, trade body Solvent Extractors’ Association of India (SEA) said. In June, India imported 1.3 million tonnes of edible oils.
Palm oil imports increased from 683,133 tonnes in June to 1.09 million tonnes in July, the highest in seven months, according to average estimates from the dealers.
Oil prices rose more than 1% on Wednesday, trading near their highest since April, after industry data showed a much steeper-than-expected draw last week in crude oil inventories in the United States, the world’s biggest fuel consumer.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
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