Palm ends flat as traders await MPOB demand and supply data

KUALA LUMPUR: Malaysian palm oil futures ended flat on Tuesday, as ongoing weather risk to production and stronger soyoil prices supported the market, while traders awaited fresh cues from demand and supply data to be released by the industry regulator this week.

The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange fell 1 ringgit, or 0.02%, to 4,977 ringgit ($1,226.77) a metric ton at the close.

The market traded higher due to persistent El Nino weather concerns combined with strength in soybean oil, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.

The Malaysian Palm Oil Board (MPOB) is expected to release its August demand and supply data on Thursday.

Dalian’s most-active soyoil contract rose 0.51%, while its palm oil contract added 1.37%. Soyoil prices on the Chicago Board of Trade were up 0.82%.

Palm oil tracks the price movements of rival edible oils as it competes for a share of the global vegetable oils market.

Oil prices hit multi-week highs after Iran-backed Houthis attacked Saudi energy facilities and Tehran threatened the United States with “economic warfare”.

Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.

The ringgit, palm’s currency of trade, weakened 0.32% against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.

India’s aggressive vegetable-oil buying has led to congestion at major ports, delaying vessel unloading by as much as 10 days as shore tanks fill and refiners struggle to clear incoming cargo, industry officials told Reuters.