KUALA LUMPUR: Malaysian palm oil futures closed higher on Wednesday, supported by bargain buying following a two-session decline and a rebound in crude oil prices.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange gained 21 ringgit, or 0.45percent, to 4,663 ringgit (USD1,140.93) a metric ton at the close. It lost 1.67percent in the previous two sessions.
Crude palm oil futures traded higher on bargain buying owing to a rebound in energy prices and some strong palm oil physical coverage from India, said Anilkumar Bagani, commodity research head at Sunvin Group.
“The optimistic increase in Malaysian palm oil exports this month so far has also cushioned prices,” he said. Cargo surveyors estimated that exports of Malaysian palm oil products for July 1-25 rose between 8.1percent and 15.9percent from a month earlier.
Higher production estimates for the July 1-20 period and the absence of Indonesia’s B50 biodiesel allocations capped gains, Bagani added. Oil prices jumped more than 3percent as tensions in the Middle East escalated following US and Saudi strikes in Iraq and an intercepted Iranian missile attack on US forces, while US crude inventories fell. Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
Dalian’s most-active soyoil contract fell 0.23percent, while its palm oil contract added 0.64 percent. Soyoil prices on the Chicago Board of Trade were up 0.04percent.
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 0.05percent against the dollar, making the commodity slightly more expensive for buyers holding foreign currencies.
European Union soybean imports for the 2026/27 season that began in July had reached 0.56 million metric tons by July 26, down 39percent from the same period a year earlier, while palm oil imports fell 39percent to 0.13 million tons, European Commission data showed.
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