SINGAPORE: Malaysian palm oil futures rebounded on Friday after declining for two sessions, tracking gains in rivals soyoil and crude oil, but the market is poised for a weekly loss.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange rose 21 ringgit, or 0.54% to 3,895 ringgit ($815.71) a metric ton as of 0245 GMT.
Malaysian palm oil futures easier
It fell 0.62% during overnight trade. The contract is down about 0.8% for the week.
Fundamentals
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Dalian’s most-active soyoil contract fell 0.29%, while its palm oil contract shed 0.41%. Soyoil prices on the Chicago Board of Trade rose 0.48%.
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Soyoil rose as dry and hot weather throughout the season in northern Argentina may lead the Buenos Aires grains exchange to reduce its estimate for the country’s 2023/24 soybean crop.
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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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The Malaysian ringgit, palm’s currency of trade, weakened 0.04% against the dollar. A weaker ringgit makes palm oil more attractive for foreign currency holders.
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Oil prices rose as players took stock of the US Treasury secretary’s comments that the country’s economy is likely in a stronger position than indicated by weak first-quarter data, coupled with supply concerns as conflict continues in the Middle East.
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Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
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Palm oil may slide into a range of 3,760 ringgit to 3,787 ringgit per ton, driven by a wave (5), said Reuters technical analyst Wang Tao.
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