SINGAPORE: Malaysian palm oil futures rose on Friday amid higher edible and crude oil prices, and are headed for a more than 3% weekly gain.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange rose 48 ringgit, or 1.18% to 4,119 ringgit ($878.63) a metric ton in morning trade, the highest intraday price reached since July 27.
It had gained 0.27% during overnight trade.
Malaysian palm oil futures rise
The contract is set for a weekly gain of around 3.6%, fuelled by tight supply and optimism over palm demand.
Fundamentals
Dalian’s most-active soyoil contract rose 1.33%, while its palm oil contract gained 0.96%. Soyoil prices on the Chicago Board of Trade increased 0.78%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Oil prices rose on Friday, driven by growing demand in the United States and China, the world’s biggest oil consumers, and as the US Federal Reserve gave a positive signal on possibility of rate cuts.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The Malaysian ringgit, palm’s currency of trade, strengthened 0.32% against the dollar. It rose as much as 0.6% earlier in the session, the highest since Jan. 16.
Palm oil may break resistance at 4,106 ringgit and climb into a range of 4,106-4,158 ringgit per metric ton, said Reuters technical analyst Wang Tao.
Source: Brecorder
