Malaysian palm oil futures rose more than 1 percent on Monday, charting their first gain in four sessions, on expectations that exports would pick up this month while production remains weak. On Tuesday, cargo surveyors Intertek Testing Services and Societe Generale de Surveillance will release shipment data for the first 10 days of January, and industry regulator Malaysian Palm Oil Board (MPOB) will report export data for December.
Benchmark palm oil futures for March delivery on the Bursa Malaysia Derivatives Exchange were up 1.2 percent at 3,112 ringgit ($695.42) a tonne at the close of trade. Traded volumes stood at 54,931 lots of 25 tonnes each on Monday evening. "Traders are squaring some positions before MPOB releases the data. Stock availability is very poor while everyone is expecting better exports in January," a trader from Kuala Lumpur said.
"The general feeling is exports this month will be better, but production will not improve considerably. Supply in Indonesia is very tight too ... 3,100 ringgit seems to be the support level for prices." Palm oil inventories in Malaysia, the world's second-largest producer, likely declined for the first time in four months in December due to slowing production, a Reuters poll showed.
Exports are likely to have fallen about 4 percent in December but are seen rising in January ahead of the Lunar New Year celebrations in China at the end of this month, traders said. Palm oil may inch up to 3,128 ringgit per tonne as it has pierced above resistance at 3,089 ringgit, according to Reuters market analyst for commodities and energy technicals Wang Tao. In related vegetable oils, the March soyabean oil contract on the CBOT was up 0.3 percent, while the May soyabean oil contract on the Dalian Commodity Exchange dropped 0.4 percent. The May contract for Dalian palm olein gained 0.1 percent.
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