KUALA LUMPUR: Malaysian palm oil futures rose on Thursday, buoyed by robust demand from key buyer China and firmer crude oil prices, although mixed demand from top importer India capped the gains.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange gained 51 ringgit, or 1.34%, to 3,866 ringgit ($820.11) by midday.
Good demand from China ahead of the Lunar New Year festive period was seen, but some importers in India opted for soft oils like soya due to disparities in the world’s biggest importer of vegetable oil, said Mitesh Saiya, trading manager at Mumbai-based trading firm Kantilal Laxmichand & Co.
Oil prices rose on Thursday as OPEC forecast relatively strong growth in global oil demand over the next two years and the market eyed disrupted US oil production amid a cold blast, as well as geopolitical tensions in the Middle East. Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
Dalian’s most-active soyoil contract fell 0.35%, while its palm oil contract ticked up 0.03%.
Soyoil prices on the Chicago Board of Trade were up 0.04%. Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
The ringgit, palm’s currency of trade, rose 0.02% against the dollar, making the commodity more expensive for buyers holding the foreign currency.
Exports of Malaysian palm oil products for Jan. 1-15 were estimated to be down 2.6% at 604,474 tons from a month earlier, independent inspection company AmSpec Agri Malaysia said on Monday.
Data from cargo surveyor Intertek Testing Services showed that exports for Jan. 1-15 rose 6.5% to 629,918 tons.
Palm oil may fall further into a range of 3,768 to 3,780 ringgit per metric ton as an uptrend from 3,607 ringgit may have reversed, Reuters technical analyst Wang Tao said.
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