KUALA LUMPUR: Malaysian palm oil futures jumped more than 2 percent to a one-week high on Wednesday evening, as the ringgit weakened and related edible oils recovered.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 1.8 percent at 2,211 ringgit ($544.98) a tonne at the close, after rising to its highest since July 11 at 2,218 ringgit.
Trading volume stood at 63,352 lots of 25 tonnes each at the end of the trading day.
“Palm prices are up on the ringgit’s depreciation,” said one futures trader in Kuala Lumpur, adding that the market also rose on a technical rebound. “It had been below 2,200 ringgit for some time,” he said.
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The ringgit, palm’s currency of trade, fell 0.3 percent to 4.0570 per dollar, its weakest since late December, making the edible oil cheaper for foreign buyers.
The rebound in related oils such as US soyoil also helped palm gain, said another trader.
Palm oil prices are usually affected by the performance of other edible oils as they compete for a share in the global vegetable oils market.
The Chicago December soybean oil contract was up 0.8 percent, while the September soybean oil contract on China’s Dalian Commodity Exchange rose 0.4 percent.
Meanwhile, the Dalian September palm oil contract was up 0.2 percent.
Palm oil is expected to retest support at 2,148 ringgit per tonne, according to Wang Tao, a Reuters market analyst for commodities and energy technicals.
Source: Brecorder
