KUALA LUMPUR: Malaysian palm oil futures rose on Tuesday, supported by gains in Chicago soyoil, while traders awaited export data from cargo surveyors.
Palm drops more than 3% on weakness of Dalian palm olein
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange was up 40 ringgit, or 0.82%, at 4,939 ringgit ($1,104.92) a metric ton in early trade. It fell 3.71% in the previous session.
Fundamentals
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Dalian’s most-active soyoil contract fell 0.36%, while its palm oil contract shed 0.46%. Soyoil prices on the Chicago Board of Trade were up 0.13%.
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Palm oil tracks the price movements of rival edible oils, as they compete for a share of the global vegetable oils market.
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Cargo surveyors are expected to release their estimates for Malaysian palm oil exports for the Nov. 1-20 period on Wednesday.
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Oil prices retreated after the previous day’s rally, driven by stalled production at Norway’s Johan Sverdrup oilfield, but investors remained cautious amid fears of a potential escalation in the Russia-Ukraine war.
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Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
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The ringgit, palm’s currency of trade, strengthened 0.2% against the dollar, making the commodity more expensive for buyers holding foreign currencies.
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Palm oil prices are expected to remain above 4,750 ringgit in November, supported by export supply uncertainties and rising soft oil prices, the Malaysian Palm Oil Council said.
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Palm oil may break support at 4,816 ringgit per metric ton and fall towards 4,732 ringgit, Reuters technical analyst Wang Tao said.
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