MARKET DEVELOPMENT
VEGOILS-Palm jumps 4%, hits all-time high on Ukraine attacks
VEGOILS-Palm jumps 4%, hits all-time high on Ukraine attacks
By Mei Mei Chu
KUALA LUMPUR, Feb 24 (Reuters) - Malaysian palm oil futures spiked 4% on Thursday to a record high, the biggest daily increase in six months, as Russian forces fired missiles at several Ukrainian cities, raising concerns of a disruption in global edible oil supplies.
The benchmark palm oil contract FCPOc3 for May delivery on the Bursa Malaysia Derivatives Exchange rose 258 ringgit, or 4.3%, to 6,240 ringgit a tonne by the midday break.
The contract extended gains for a sixth consecutive session, its longest rally since mid-March 2021. The spot contract FCPOc1 also hit a record high of 6,790 ringgit.
Russian forces fired missiles at several Ukrainian cities and landed troops on its south coast on Thursday, officials and media said, after President Vladimir Putin authorised what he called a special military operation.
Crude oil breached $100 a barrel for the first time since 2014, making palm a more attractive option as biodiesel feedstock. O/R
"As long as Russia-Ukraine issue is not sorted out in the near term, we will continue to see new record highs, but this could be short-term," a Kuala Lumpur-based trader said.
The market could retreat if there are no other fresh bullish news to sustain it, the trader added.
Uncertainty over sunflower oil supplies due to the conflict is spurring demand for palm oil and soyoil, fuelling a red-hot vegetable oil market.
Dalian's most-active soyoil contract DBYcv1 rose 3.4%, while its palm oil contract DCPcv1 gained 3.2%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 2.7%.
In Malaysia, tight palm oil supply underpins the market as industry estimates for February so far indicate a sharp hike in exports while production lags.
(Reporting by Mei Mei Chu; Editing by Rashmi Aich and Shounak Dasgupta)((Meifong.chu@thomsonreuters.com))
https://www.nasdaq.com/articles/vegoils-palm-jumps-4-hits-all-time-high-on-ukraine-attacks