KUALA LUMPUR: Malaysian palm oil futures rose on Tuesday, supported by gains in Chicago soyoil, while traders awaited export data from cargo surveyors.
Palm drops more than 3% on weakness of Dalian palm olein
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange was up 40 ringgit, or 0.82%, at 4,939 ringgit ($1,104.92) a metric ton in early trade. It fell 3.71% in the previous session.
Fundamentals
Dalian’s most-active soyoil contract fell 0.36%, while its palm oil contract shed 0.46%. Soyoil prices on the Chicago Board of Trade were up 0.13%.
Palm oil tracks the price movements of rival edible oils, as they compete for a share of the global vegetable oils market.
Cargo surveyors are expected to release their estimates for Malaysian palm oil exports for the Nov. 1-20 period on Wednesday.
Oil prices retreated after the previous day’s rally, driven by stalled production at Norway’s Johan Sverdrup oilfield, but investors remained cautious amid fears of a potential escalation in the Russia-Ukraine war.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, strengthened 0.2% against the dollar, making the commodity more expensive for buyers holding foreign currencies.
Palm oil prices are expected to remain above 4,750 ringgit in November, supported by export supply uncertainties and rising soft oil prices, the Malaysian Palm Oil Council said.
Palm oil may break support at 4,816 ringgit per metric ton and fall towards 4,732 ringgit, Reuters technical analyst Wang Tao said.
Source: Brecorder
