SINGAPORE: Malaysian palm oil futures rose on Friday, as traders reacted to strong export data and signs of robust demand for the vegetable oil.
The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange closed up 60 ringgit, or 1.6% at 3,803 ringgit ($808.12) a metric ton.
The contract gained 1.1% this week, its steepest gains in a month.
Malaysia’s palm oil stockpiles stood at four-year highs at the end of October despite more-than-expected exports, data from the Malaysian Palm Oil Board (MPOB) showed on Friday.
Exports of Malaysian palm oil products for Nov. 1-10 rose 1% to 1.9% from a month earlier, data from cargo surveyors showed.
In a recent wave of buying, China has purchased up to 1.04 million metric tons of U.S. soybeans, displaying signs of strong demand.
Palm oil declines on subdued China data, MPOB report awaited
India’s soymeal exports are likely to rise in coming months as concerns over output in top producer Brazil lift global prices to two-month highs, prompting buyers to turn to the south Asian country, industry officials said.
Soybean prices impact the cost of soyoil, which competes with palm oil for a share of the market.
Soyoil prices on the Chicago Board of Trade rose 0.4%. Dalian’s most-active soyoil contract was up 0.3%, while its palm oil contract climbed 1.3%.
Crude oil prices were up slightly on Friday but are set to fall for a third week as concerns of supply disruptions from the Israel-Hamas conflict have ebbed, allowing demand worries to reassert themselves.
Stronger crude oil prices make palm oil a more attractive option for biodiesel feedstock.
The Malaysian ringgit, palm’s currency of trade, weakened 0.3% against the dollar, making palm oil more attractive for foreign currency holders.
The Bursa Malaysia will be closed on Monday for the Deepavali holiday. Trading will resume on Tuesday, Nov. 14.
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