Palm oil futures hit 2-week high as ringgit weakens

• Palm oil may test a resistance at 2,205 ringgit per tonne.
• The ringgit, palm's currency of trade, eased to a three-week low against the dollar.

SINGAPORE: Malaysian palm oil futures on Wednesday extended gains for a fourth consecutive session, hitting their highest in more than two weeks, supported by a weaker ringgit and firmer soyoil on China's Dalian Commodity Exchange.

The ringgit, palm's currency of trade, eased to a three-week low against the dollar, making the edible oil cheaper for holders of foreign currencies.

The ringgit was down 0.1pc at 4.1960.

The benchmark palm oil contract for the December delivery on the Bursa Malaysia Derivatives Exchange was up 1.1pc at 2,199 ringgit ($524.07) per tonne.

It earlier rose as much as 1.4pc to 2,206 ringgit, its highest levels since Sept. 23.

Palm oil may test a resistance at 2,205 ringgit per tonne, a break above which could lead to a gain to 2,223 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

"Dalian exchange oils are higher today and the trade talks between the United States and China are now faltering," said a Kuala Lumpur-based trader, referring to palm and soyoil on China's Dalian Commodity Exchange.

While the tensions between the world's two largest economies showed little sign of slowing, traders say that China - the world's top soybean importer - has shunned the U.S. market for a second growing season, which in turn, resulted in higher demand for palm oil.

The January palm oil contract on the Dalian exchange rose 1.9pc on Wednesday, while the January soyoil contract on the Dalian exchange was up 1.0pc.

In other related edible oils, U.S. soyoil futures on the U.S. Chicago Board of Trade was last traded 0.2pc higher.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.