Malaysian palm oil futures recouped losses to end higher on Tuesday as the country eyed more imports from India, days after a report stated that India was considering restricting imports of palm oil and other products from the country. The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange ended 0.7% higher at 2,173 ringgit ($518.74), after hitting its lowest since October 3 during the session.
Malaysia's minister in charge of palm oil portfolio said it will look to increase imports of crude sugar and buffalo meat from India "in light of India's importance as our third-largest export destination". "Prices picked up on a weaker ringgit and Malaysia's renewed talks for more imports of Indian goods," said Anilkumar Bagani, research head at Sunvin Group, a Mumbai-based vegetable oil broker.
The ringgit was up 0.1% at close. Palm oil futures also recovered from losses despite competitive oils trading weaker. US soyaoil futures on the Chicago Board of Trade declined 0.1%. The January palm oil contract on the Dalian exchange fell 0.9%, while the January soyaoil contract on the Dalian exchange fell 0.5%. Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
The vegetable oil contract took a hit this week after Indian refiners stopped purchases of Malaysian palm oil for shipments in November and December fearing New Delhi could raise import taxes or enforce other measures to curtail imports from the country.
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