KUALA LUMPUR: Malaysian palm oil futures rose on Monday for a third straight session, hitting their highest levels in more than two weeks on a weaker ringgit and higher exports.
The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange gained 21 ringgit, or 0.56%, to 3,780 ringgit ($797.97) a metric ton by the midday break, hitting its highest since Sept. 29.
Exports of Malaysian palm oil products for Oct. 1-15 rose 7.3% to 623,245 metric tons from 580,893 metric tons shipped during Sept. 1-15, cargo surveyor Intertek Testing Services said on Sunday.
“We are also seeing a tapering in production in Peninsular Malaysia and a double-digit drop in East Malaysia,” said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari.
Top producer Indonesia lowered its crude palm oil (CPO) reference price for the Oct. 16-31 period to $740.67 per ton from $827.37 per ton currently, a trade ministry regulation showed on Friday.
Key buyer India’s palm oil imports in September fell 26% from the previous month to 834,797 tons, the lowest in three months, as higher inventories prompted refiners to curtail purchases, a trade body said on Friday.
India’s Sept palm oil imports drop on higher stocks
The ringgit, palm’s currency of trade, fell 0.25% against the dollar, making the commodity cheaper for buyers holding foreign currency.
In related oils, soybean harvest downgrades in a monthly US Department of Agriculture (USDA) report last week lifted prices. Soyoil prices on the Chicago Board of Trade were up 0.6%.
Dalian’s most-active soyoil contract rose 1.3%, while its palm oil contract gained 1.9%. Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil may extend gains into a range of 3,768 ringgit to 3,795 ringgit per ton, as it has pierced above a resistance zone of 3,720 ringgit to 3,730 ringgit, Reuters technical analyst Wang Tao said.
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