21.03.2019 (The Edge Markets MY) - KUALA LUMPUR (March 21): Malaysian palm oil futures hit a more than two week high on Thursday, as easing concerns about high output and expectations of better export demand buoyed investor sentiment.

The benchmark third-month palm oil contract on the Bursa Malaysia Derivatives Exchange was up 0.4% at 2,172 ringgit (US$534.98) a tonne, locking in a fifth straight session of gains, after earlier hitting its highest level since March 4.

"Earlier expectations of a production increase is changing and exports are picking up," said a Kuala Lumpur-based trader, adding that hot weather could also lead to slowing output.

Top producers Indonesia and Malaysia had a bumper harvest last year, flushing the market with palm oil and dampening prices. And European Union plans to phase out palm oil in renewable transport fuel by 2030 have added to concerns.

Cargo surveyor Societe Generale de Surveillance reported on Wednesday a rise of 0.8% in exports of Malaysian palm oil products for the March 1-20 period, compared with the same period a month ago.

Meanwhile, a stronger ringgit made the vegetable oil less attractive to buyers holding foreign currencies, limiting the gains in palm oil prices.

The ringgit rose as much as 0.3% against the dollar to its strongest level since last July.

"The ringgit has continued to appreciate after the U.S. Federal Reserve signalled no rate hike," said another trader. 

Palm oil is expected to test resistance at 2,190 ringgit per tonne, a break above which could lead to a gain to 2,227 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

The Chicago soybean oil contract was last up 0.4%. The Dalian Commodity Exchange soyoil contract was 0.3% higher, and the palm olein contract was

up 0.6%.   

 Palm, soy and crude oil prices at 1046 GMT

 Contract                         Month     Last       Change     Low    High       Volume

 MY PALM OIL                APR9     2090       -5.00       2082       2098      1357

 MY PALM OIL                MAY9     2137      +7.00       2120       2148      5257

 MY PALM OIL                JUN9      2172      +8.00      2154       2184     18458

 CHINA PALM                MAY9      4492     +26.00      4470      4502    294702

 OLEIN                                                

 CHINA SOYOIL            MAY9      5550    +18.00       5530       5572    158422

 CBOT SOY OIL            MAY9      29.39     +0.12      29.28      29.45        4257

 INDIA PALM OIL          MAR9       0.00      +0.00       0.00             0            0

 INDIA SOYOIL              APR9      740.7     +2.25     738.2    742.35        8520

 NYMEX CRUDE           MAY9      59.93     -0.30      59.81      60.33     123235

(US$1 = 4.0600 ringgit)

(US$1 = 6.6824 Chinese yuan)

(US$1 = 68.5100 Indian rupees)