NEW DELHI: Malaysian palm oil futures settled higher on Tuesday, snapping three consecutive sessions of losses, supported by the prospect of lower inventories, but higher premiums capped gains.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange closed up 25 ringgit, or 0.58%, to 4,320 ringgit ($910.43) a metric ton.
Malaysia’s palm oil inventories are likely to have declined 6.65% from the prior month to an eight-month low of 1.79 million tons at the end of March, a Reuters survey showed on Thursday.
Malaysian palm oil futures extends decline
The Malaysian Palm Oil Board (MPOB) is scheduled to release the data on April 15.
Palm traded higher, but its premium over soft oils such as soybean and sunflower has somewhat softened demand, said Anilkumar Bagani, research head at Sunvin Group, a Mumbai-based vegetable oil brokerage.
The trade remained a little sideways ahead of the Malaysian market holidays on April 10 and April 11, Bagani added.
India’s palm oil imports fell to their lowest level in 10 months in March as buyers substituted it with cheaper sunflower oil.
Soyoil prices on the Chicago Board of Trade rose 0.2%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil may drop further to 4,242 ringgit per metric ton, as pointed by a rising trendline.
Oil prices edged higher on Tuesday after hopes diminished that negotiations between Israel and Hamas would lead to a ceasefire in Gaza, and on Mexico’s plan to remove more crude from the global market.
Global shares were mixed on Tuesday ahead of this week’s U.S. inflation reading and a crucial European Central Bank meeting, while industrial metals prices extended recent gains on expectations of a worldwide manufacturing rebound.
Comments