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Palm jumps to one-week peak, tracking related oils

Palm jumps to one-week peak, tracking related oilsKUALA LUMPUR: Malaysian palm oil futures rose by more than 1 percent on Friday, tracking strength in related edible oils on the US Chicago Board of Trade and China’s Dalian Commodity Exchange.

The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange was 0.7 percent up at 2,238 ringgit ($545.19) a tonne at the close of trade. It earlier rose as much as 1.3 percent to 2,250 ringgit, its highest since Aug. 10.

The gains, however, were not quite enough to avoid a 0.2 percent decline for the week.

Trading volumes stood at 37,337 lots of 25 tonnes each on Friday evening.

“External markets are bullish. Overnight it (soyoil) went up, impacting palm,” said a Singapore-based trader.

Palm oil prices are affected by movements of other edible oils that compete in the global vegetable oils market.

Chicago soyoil rose in tandem with soybeans, which hit a one-week high on Thursday on support from expectations that China could return to the US market.

The Chicago December soybean oil contract rose 1 percent on Thursday and was last up 0.5 percent on Friday.

China said on Thursday that it would hold a fresh round of trade talks with the United States in Washington this month, offering hope for progress in resolving a conflict that has set world markets on edge.

China, a key buyer of soybeans from the United States, had imposed extra tariffs on US soybean imports and shifted its purchases to Brazil after a trade spat between the two nations.

However, two vessels carrying US soybeans have entered China, suggesting that China will still need to import from the United States to cover its needs, traders said.

In related oils, the January soybean oil contract on China’s Dalian Commodity Exchange rose 0.9 percent, while the Dalian January palm oil contract gained 1.2 percent.

Palm oil could rise into a range of 2,269-2,277 ringgit a tonne, having cleared resistance at 2,224 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

Copyright Reuters, 2018

Source: Brecorder

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