KUALA LUMPUR: Malaysian palm oil futures inched higher on Friday but logged a weekly loss as profit-taking and weak demand in key destination countries kept the market under pressure.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange gained 39 ringgit, or 0.86%, to 4,578 ringgit ($1,030.38) a metric ton at the close.
The contract is down 1.02% for the week. Crude palm oil was pressured due to profit-taking as it has been forced to narrow down the widening price premium over competing oils, said Anilkumar Bagani, head of research at Mumbai-based vegetable oil broker Sunvin Group. “The persistently dry destination demand is also a concern for palm oil at the moment, especially at a time when exports are also not improving,” he said.
Dalian’s most-active soyoil contract rose 2.02%, while its palm oil contract gained 0.82%. Soyoil prices on the Chicago Board of Trade were up 0.61%.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market. Cargo surveyors are expected to release their exports estimates for the March 1-15 period on Saturday. Oil prices rebounded to recover some of their losses of more than 1% in the previous session, partly due to the diminishing prospects of a quick end to the Ukraine war that could bring back more Russian energy supplies.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock. The ringgit, palm’s currency of trade, weakened 0.18% against the dollar, making the commodity cheaper for buyers holding foreign currencies.
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