KUALA LUMPUR: Malaysian palm oil futures opened higher on Monday, supported by firmer rival Dalian contracts and Chicago soyoil prices, ahead of the cargo surveyors’ export estimates for the month in the world’s second-biggest producer.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange rose 38 ringgit, or 0.98%, to 3,934 ringgit ($824.39) a metric ton during early trade.
Palm oil extends decline on weaker rivals, higher production
The contract lost 0.76% last week.
Fundamentals
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Cargo surveyors are expected to release exports estimates for April on Tuesday.
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Dalian’s most-active soyoil contract gained 1.35%, while its palm oil contract added 1.88%. Soyoil prices on the Chicago Board of Trade were up 0.86%.
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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 fell in early Asian trading on Monday, erasing gains from Friday as Israel-Hamas peace talks in Cairo eased fears of a wider conflict in the Middle East and US inflation data further dimmed the prospects of interest rate cuts anytime soon.
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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, weakened 0.1% against the dollar, making the commodity less expensive for buyers holding the foreign currency.
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Palm oil may rise into a range of 3,942-3,969 ringgit per metric ton, as a downtrend from the April 3 high of 4,443 ringgit may have reversed, Reuters technical analyst Wang Tao said.
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