KUALA LUMPUR: Malaysian palm oil futures extended gains on Thursday to hit a four-month peak as Russia’s withdrawal from the Black Sea grain deal heightened concerns over edible oil supplies from the region.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange closed up 152 ringgit, or 3.9%, to 4,047 ringgit ($891.41) a metric ton, its highest since March 15.
The contract tracked bullish momentum in competing markets amid escalating tensions between Russia and Ukraine, said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.
Russia warned that from Thursday any ships sailing to Ukraine’s Black Sea ports would be seen as potentially carrying military cargoes, as Kyiv accused Moscow of carrying out “hellish” overnight strikes that damaged grain export infrastructure.
“The tremors were felt across markets on Wednesday as Chicago soybeans and soy oil, ICE Canola and Euronext rapeseed futures jumped sharply,” Bagani said.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Dalian’s most-active soyoil contract gained 1.7%, while its palm oil contract also rose 1.7%. Soyoil prices on the Chicago Board of Trade were up 1.1%.
India’s imports of sunflower oil are likely to fall in the coming months as it becomes uncompetitive against rival oils due to rising prices after Russia withdrew from the Black Sea grain deal, industry officials told Reuters.