JAKARTA: Malaysian palm oil futures closed higher for a third straight session on Wednesday, supported by firm Chicago soyoil and Dalian palm olein and soyoil futures, although a stronger ringgit capped further gains.
The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange gained 12 ringgit, or 0.28percent, to 4,272 ringgit (USD1,091.19) a metric ton at the close.
“The futures continued to exhibit the broader uptrend, riding on the bullish waves of Chicago’s soyoil, Dalian’s palm olein, soyoil futures and upward momentum in energy prices,” said Anilkumar Bagani, commodity research head at a Mumbai-based brokerage Sunvin Group. Weaker production and healthy exports in January have also supported palm oil, keeping its bullish momentum intact, but a stronger ringgit has limited the gains, he added.
Dalian’s most-active soyoil contract rose 1.44percent, while its palm oil contract gained 1.49 percent. Soyoil prices on the Chicago Board of Trade were up 0.2percent.
Palm oil tracks 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 0.89percent against the dollar, making the commodity more expensive for buyers holding foreign currencies.
Oil prices gained further ground on Wednesday as supply concerns lingered after a winter storm disrupted US crude output and exports, while Middle East tensions lent additional support.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock. Meanwhile, cargo surveyor Intertek Testing Services said Malaysian palm oil product exports for January 1-25 increased 9.97 percent from a month earlier, while independent inspection company AmSpec Agri Malaysia pegged the rise at 7.97 percent.
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