SINGAPORE: Malaysian palm oil futures extended gains on Tuesday amid higher crude oil prices, although a stronger ringgit capped gains.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange rose 14 ringgit, or 0.33% to 4,261 ringgit ($903.33) a metric ton in morning trade, as of 0234 GMT.
Declining Indonesian palm oil exports may affect domestic supply, officials say
It had gained 0.64% during overnight trade.
Fundamentals
Palm oil is affected by price movements in related oils, as they compete for a share in the global vegetable oils market.
Oil prices were on track to gain for a second straight day, after settling up more than a dollar on expectations of tighter supply driven by Russian production cuts and attacks on Russian refineries.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The Malaysian ringgit, palm’s currency of trade, strengthened 0.13% against the dollar. A stronger ringgit makes palm oil less attractive for foreign currency holders.
Palm oil may continue to rise towards the resistance levels of RM4,400-4,420 per ton this week, with supports at RM3,980-4,000 per ton, LSEG Agriculture Research said in its weekly report published on Monday.
Palm oil may revisit its March 21 high of 4,314 ringgit per ton, as its strong gain on Monday suggests a continuation of the uptrend, said Reuters technical analyst Wang Tao.