KUALA LUMPUR: Malaysian palm oil futures closed higher on Monday, snapping two consecutivesessions of declines, buoyed by stronger rival soyoil prices.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange gained 69 ringgit, or 1.81%, to 3,884 ringgit ($905.99) a metric ton at the close.
Crude palm oil futures were trading higher following a rebound in the strength of the rival oilseeds market, a Kuala Lumpur-based trader said.
Dalian’s most-active soyoil contract rose 0.31%, while its palm oil contract fell 0.1%. Soyoil prices on the Chicago Board of Trade were up 0.84%.
Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
The ringgit, palm’s currency of trade, strengthened 0.12% against the dollar, making the commodity cheaper for buyers holding foreign currencies.
Palm ends with third straight weekly loss
Oil slipped, weighed down by Moody’s downgrade of the U.S. sovereign credit rating and official data that showed slowing growth in China’s industrial output and retail sales.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The Indonesia Palm Oil Association urged the government to delay a planned hike in the palm oil export levy, warning it could harm competitiveness amid global trade uncertainties due to the U.S. tariffs and geopolitical tensions.
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