KUALA LUMPUR: Malaysian palm oil futures were little changed on Friday, after logging their highest close in more than a year in the previous session, as stronger Dalian rival oils offset weaker crude oil prices.
Palm oil climbs, perched at highest levels in over a year
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange slid 4 ringgit, or 0.09%, to 4,291 ringgit ($912.78) during early trade.
The contract logged its highest closing levels since March 3, 2023 on Thursday.
Fundamentals
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Dalian’s most-active soyoil contract edged up 0.26%, while its palm oil contract gained 0.94%. Soyoil prices on the Chicago Board of Trade were down 0.21%.
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Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
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Oil prices edged lower on Friday but were on track to gain nearly 4% for the week as sharp declines in US crude and fuel inventories, drone strikes on Russian refineries and a rise in energy demand forecasts buoyed prices.
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Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
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The Malaysian ringgit, palm’s currency of trade, fell 0.36% against the dollar, making the commodity less expensive for buyers holding the foreign currency.
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Malaysia’s palm oil stocks at the end of February dwindled to their lowest in seven months as production hit a 10-month low, offsetting the slowdown in exports.
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Palm oil may break resistance at 4,326 ringgit and rise into a range of 4,378-4,410 ringgit per metric ton, driven by a wave C, Reuters technical analyst Wang Tao said.
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