JAKARTA: Malaysian palm oil futures extended gains for a fifth straight session on Wednesday, as Malaysia’s stockpile slipped to a four-month low.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange increased 27 ringgit, or 0.72%, to 3,759 ringgit ($810.30) a metric ton on the closing.
Data from the Malaysian Palm Oil Board (MPOB) on Wednesday showed that inventories fell 4.64% month-on-month to 2.29 million metric tons at December-end, the lowest since August.
Production is expected to further decline amid a seasonal cycle, Anilkumar Bagani, head of research at India-based Sunvin Group, said.
“Palm oil (is) currently looking for support from soyoil, sunflower oil and crude oil markets.”
Dalian’s most-active soyoil contract rose 2.30% and its palm oil contract increased 3.29%. Soyoil prices on the Chicago Board of Trade fell 0.21%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Indonesia in 2023 approved the replanting of 53,012 hectares(130,995.5 acres) of palm oil trees on land owned by smallholder farmers under a subsidised programme, data from the country’s palm oil funding agency showed on Wednesday.
Meanwhile, exports of Malaysian palm oil products for Jan. 1-Jan. 10 fell 9.8% to 349,075 tonnes from 386,986 tonnes shipped during Dec. 1-Dec. 10, independent inspection company AmSpec Agri Malaysia said on Wednesday.
Exports of these products fell 3.9% to 354,465 metric tons for Jan. 1-Jan. 10 from 368,990 metric tons during Dec. 1-Dec. 10, cargo surveyor Intertek Testing Services said on Wednesday.
Oil prices climbed around 2% on Tuesday as the Middle East crisis and a Libyan supply outage pared the previous day’s heavy losses.
The Malaysian ringgit, palm’s currency of trade, was flattish against the U.S dollar.
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