NEW DELHI: Malaysian palm oil futures closed higher on Tuesday after two straight sessions of losses, buoyed by a jump in soyoil prices in Chicago.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange gained 0.08% to 3,707 ringgit ($790.39) a metric ton at closing.
Palm oil futures dropped 6.06% on a monthly basis in September after posting two consecutive monthly gains.
“Palm oil is higher just as Chicago soyoil prices have inched up. But we may not see any major big, upward movement in prices due to weak demand,” said a New Delhi-based trader.
Buyers in top destination China have put off purchases due to holidays.
The Dalian Commodity Exchange is closed from Sept. 29 to Oct. 6 for the Mid-Autumn Festival and National Day.
Soyoil prices on the Chicago Board of Trade were up 0.47%.
Exports of Malaysian palm oil products for September were seen rising between 5.4% and 8.1%, according to data from independent inspection company AmSpec Agri Malaysia and cargo surveyor Intertek Testing Services.
Indonesia raised its crude palm oil reference price to $827.37 a metric ton for Oct. 1-15, which kept export tax and levy for crude palm oil unchanged at $33 and $85 per metric ton.
Indonesia’s Palm Oil Association expects a 5% increase in the country’s palm oil output this year and sees stocks at around 3.2 million metric tons by the year’s end.
Malaysian palm oil is expected to trade between 3,700 and 4,500 ringgit ($790-$960) per metric ton from now until mid-2024 as the El Niño weather pattern threatens supplies amid rising demand, analysts said.
Palm oil may rise into a range of 3,765-3,795 ringgit per metric ton, following its stabilisation around a support of 3,686 ringgit.
Oil prices slipped in early trade on Tuesday, after falling to a three-week low in the previous session, on a stronger U.S. dollar, rising U.S. bond yields and mixed supply signals.
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