SINGAPORE: Malaysian palm oil futures ended at more than a three-week high on Monday, mirroring the strength in rival edible oils, while firm export data supported sentiment.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange finished 64 ringgit, or 1.65%, higher at 3,935 ringgit ($846.78) per metric ton, paring losses from the previous session.
Exports of Malaysian palm oil products for Aug. 1-20 rose between 9.8% and 17.4% from the same period a month earlier cargo surveyors Intertek Testing Services and Amspec Agri said, respectively.
Dalian’s most-active soyoil contract increased 0.8%, while its palm oil contract was up 0.5%. Soyoil prices on the Chicago Board of Trade climbed 1.3%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Bean oil markets firmed as dry weather in the United States threatened to impact supply during the critical pod-filling season, while floods in China damaged crops, cutting corn and soybean production, said Mitesh Saiya, trading manager at Mumbai-based firm Kantilal Laxmichand and Co.
As such, consumers mostly switched to palm as it remains the most affordable alternative, Saiya said.
The Malaysian ringgit, palm’s currency of trade, weakened 0.04% against the dollar. A weaker ringgit makes palm oil more attractive for foreign currency holders.
The European Union said last Thursday it had launched an investigation into whether biodiesel from Indonesia was circumventing EU duties by going through China and Britain.
Palm oil may break a support of 3,861 ringgit per metric ton and fall to the next support of 3,778 ringgit, said Reuters technical analyst Wang Tao.
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