KUALA LUMPUR: Malaysian palm oil futures rose on Monday, as estimates of higher exports of the edible oil and firmer crude oil prices countered weakness in rival oils and underpinned the market.
Malaysian palm oil erases early gains on rising output
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange gained 12 ringgit or 0.31%, to 3,897 ringgit ($828.44) per metric ton during early trade.
The contract had lost 0.18% last week.
Fundamentals
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Malaysian palm oil exports for May 1-25 rose between 2.4%and 3.1% from the month before, according to cargo surveyors.
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Oil prices were in a holding pattern in early Asian trading on Monday as markets awaited an OPEC+ meeting on June 2 where producers are expected to discuss maintaining voluntary output cuts for the rest of the year.
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By 0305 GMT, the benchmark Brent crude was up 0.15% at $82.24 per barrel.
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Firmer crude oil futures make palm a more attractive option for biodiesel feedstock.
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Dalian’s most-active soyoil contract fell 0.72%, while its palm oil contract lost 0.13%.
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Palm oil is affected by price movements in related oils as they compete for a share of the global vegetable oils market.
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The ringgit, palm’s currency of trade, strengthened 0.15% against the dollar, making the commodity more expensive for buyers holding the foreign currency.
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Palm oil is expected to retest support at 3,865 ringgit per metric ton, a break below which could open the way towards a range of 3,812 ringgit to 3,832 ringgit, Reuters technical analyst Wang Tao said.
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