SINGAPORE: Malaysian palm oil futures rose on Thursday, snapping four consecutive sessions of losses, underpinned by a decline in production and firmer crude oil prices.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange rose 35 ringgit, or 1%, to 3,656 ringgit ($789.12) a metric ton.
Malaysia’s palm oil inventories at the end of December likely fell further despite shrinking exports, as production declined, a Reuters survey showed on Thursday.
Analysts are anticipating a decrease in palm oil stocks as the festive season concludes.
India’s palm oil imports in December rose to their highest in four months as purchases of refined palmolein surged because of competitive prices, five dealers told Reuters on Wednesday.
Indonesia recorded domestic sales obligation realisation of 3.26 million metric tons in 2023, which translated into 25.2 million tons in export permits, Trade Ministry official Syailendra said.
Palm oil touches 2-week low on weak export data, strong soybean supply
Oil rose more than 1% on Thursday, adding to gains in the previous session on concerns over Middle Eastern supply following disruptions at an oilfield in Libya and heightened tensions regarding the Israel-Hamas war.
Stronger crude oil prices make palm a more attractive option for biodiesel feedstock.
Dalian’s most-active soyoil contract and its palm oil contract edged down 0.1% and 0.2% respectively. Soyoil prices on the Chicago Board of Trade slipped 0.3%.
Palm oil is affected by price movements in related oils as they compete for a share of the global vegetable oils market.
Hot, dry weather prompted analysts to slash their production estimates for Northern Brazil, the largest soybean producer, but rains this week are likely to benefit crops and improve estimates.
Higher supplies from other South American producers like Argentina are likely to offset any crop losses in Brazil.
The Malaysian ringgit, palm’s currency of trade, weakened 0.1% against the dollar, making palm oil more attractive for foreign currency holders.
Comments
Comments are closed for this article.