JAKARTA: Malaysian palm oil futures closed higher on Wednesday, supported by gains in rival soyoil in Dalian and Chicago markets and a weaker ringgit.
The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange gained 37 ringgit, or 0.91%, to 4,101 ringgit ($965.40) a metric ton at the close.
A Kuala Lumpur-based trader said that the market is in a range-bound mode, but with a positive bias due to the strength in rival oils and the ringgit’s weakness.
Soyoil on the Chicago Board of Trade (CBOT) was up 0.2%. Dalian’s most active soyoil contract gained 1.46% and its palm oil contract rose 0.73%.
Palm oil tracks the price movements of rival edible oils as it competes for a share of the global vegetable oils market.
Oil prices fell on Wednesday, after a gain of 4% in the previous session, as markets weighed up the chance of supply disruptions from the Iran-Israel conflict and as they ponder a direct US involvement.
Palm rises on higher rival soyoil, crude oil
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock. Malaysian ringgit, the palm’s contract currency of trade, eased 0.12% against the U.S. dollar, making ringgit-denominated goods more attractive for foreign currency holders.
Cargo surveyor Intertek Testing Services said exports of Malaysian palm oil products for June 1-15 rose 26.3%, compared to May 1-15, while according to independent inspection company AmSpec Agri Malaysia, the shipments rose 17.8%.
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