Palm rises on expectations of positive output, inventory data

KUALA LUMPUR: Malaysian palm oil futures climbed in Monday's morning session on expectations of supportive production and inventory data from a key industry body, traders said.

The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange rose 0.65 percent to 2,780 ringgit ($662.22) by the midday break.

Trading volumes stood at 17,242 lots of 25 tonnes each.

A Kuala Lumpur-based futures trader said the market was watching industry data estimates closely, and expected actual figures to be positive for palm prices.

"Looks like market has positive expectations, given a lower production but high inventory numbers forecast," the trader said.

Industry regulator, the Malaysian Palm Oil Board (MPOB) and cargo surveyor Intertek Testing Services released August production and export data during the midday break.

Malaysia's palm oil stocks at end-August rose 8.79 percent to 1.94 million tonnes from the previous month, MPOB said on Monday.

Intertek Testing Services said exports of Malaysian palm oil products for September 1-10 rose 6.9 percent to 379,652 tonnes from 355,009 tonnes shipped during August 1-10.

Another trader said a weaker ringgit aided sentiment. "Market is firm on projected numbers and the ringgit retreat. Anticipation of supportive MPOB data added a boost," the second trader said.

The ringgit was up 0.14 percent on Monday, easing from its rally achieved last week. A stronger ringgit makes palm oil less attractive to buyers holding foreign currencies.

In related oils, the Chicago Board of Trade soybean oil contract rose 0.4 percent.

January soybean oil on the Dalian Commodity Exchange was down 0.2 percent, while January palm olein  was up 0.8 percent.