14.03.2018 (The Edge Markets MY) - KUALA LUMPUR (March 14): Malaysian palm oil futures hit a one-week high in early trade on Wednesday, supported by overnight gains in soyoil on the Chicago Board of Trade and on technical correction after the tropical oil fell to a more than one-and-a-half-year low earlier this week.

The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange was up 0.7% at 2,430 ringgit (US$624.04) a tonne at the midday break, heading for a third consecutive session of gains.

Earlier in the session, it climbed to its highest level since March 8 at 2,433 ringgit. Palm fell to its lowest level since August 2016 at 2,350 ringgit a tonne on Monday.   

Trading volumes stood at 37,199 lots of 25 tonnes each at the midday break on Wednesday.

"The market is most likely tracking soyoil, coupled with some technical correction," said a futures trader in Kuala Lumpur.

Another trader said he still expected prices to fall to the 2,300 ringgit range after the Muslim fasting period of Ramadan, which begins in mid-May this year.

"Markets like the Middle East and North Africa will start buying for Ramadan from end-March to mid-April," he said. "But demand growth will be standard and prices will drop afterwards."

The month of Ramadan sees Muslims worldwide fast for the day before breaking it with communal feasting, incurring higher usage of palm oil for cooking purposes. Buyers of the oil usually stock up about a month ahead of Ramadan.

The Chicago Board of Trade's May soybean oil contract gained 1.5% on Tuesday and was down 0.1% on Wednesday.

The May soybean oil on China's Dalian Commodity Exchange rose 0.8% and the Dalian May palm oil contract climbed 0.9%.

Palm oil prices are impacted by movements in rival edible oils, as they compete in the global vegetable oils market.

Palm oil may bounce into a range of 2,435-2,449 ringgit per tonne, according to Wang Tao, a Reuters market analyst for commodities and energy technicals.   

 Palm, soy and crude oil prices as of 0500 GMT

 Contract                           Month            Last  Change          Low          High         Volume

 MY PALM OIL                  MAR8                0   +0.00              0              0                 0

 MY PALM OIL                  APR8             2431  +14.00           2414         2433             492

 MY PALM OIL                  MAY8             2430  +17.00           2410         2433           11206

 CHINA PALM OLEIN       MAY8               5132  +48.00           5108         5144         147376

 CHINA SOYOIL                MAY8             5736  +46.00           5712         5742         166482

 CBOT SOY OIL                 MAY8            32.19   +0.00          32.17        32.37            5957

 INDIA PALM OIL             MAR8              638.00   -1.20        637.30        641.1             137

 INDIA SOYOIL                 MAR8              777.5   -1.20          777.5          778              220

 NYMEX CRUDE               APR8              60.71   +0.00          60.68        60.92         31001

 Palm oil prices in Malaysian ringgit per tonne

 CBOT soy oil in U.S. cents per pound

 Dalian soy oil and RBD palm olein in Chinese yuan per tonne

 India soy oil in Indian rupee per 10 kg

 Crude in U.S. dollars per barrel

(US$1 = 3.8940 ringgit)

(US$1 = 65.0000 Indian rupees)

(US$1 = 6.3140 Chinese yuan)