Palm rises on support from rival oils
20.11.2023 (Hellenic Shipping News) - Malaysian palm oil futures traded higher on Wednesday, extending gains for a third consecutive session, supported by the strength in Chicago and Dalian rival oils.
The benchmark palm oil contract FCPOc3 for January delivery on the Bursa Malaysia Derivatives Exchange rose 54 ringgit, or 1.38%, to 3,958 ringgit ($849.72) a metric ton during the midday break.
“Overnight strong rival oils has lifted the benchmark. Morning profit taking activities brought price to briefly test low of 3,935 ringgit, before regain upside momentum to midday high of 3,971 ringgit,” a Kuala Lumpur-based analyst said.
Soyoil prices on the Chicago Board of Trade BOcv1 climbed 0.27%. Dalian’s most-active soyoil contract DBYcv1 was up 2.19%, while its palm oil contract DCPcv1 increased 2.75%.
Soybean prices impact the cost of soyoil, which competes with palm oil for a share in the global vegetable oil market.
Palm oil on the European vegetable oils market rose sharply on Tuesday, following rallying Malaysian palm oil futures. Prices for palm oil rose between $5 and $47.50 a ton.
Malaysia is confident exports of its palm oil and related products to China will increase further this year. The country shipped $3.72 billion worth of the commodity and related products last year to China.
While India’s imports of palm oil and sunflower oil in 2022/23 surged 24% and 54%, respectively, to record highs, helped by a rebound in consumption and steep discounts in both oils’ prices compared to rival soyoil.
Malaysia’s palm oil stockpiles stood at a four-year high at the end of October despite more-than-expected exports, data from the Malaysian Palm Oil Board (MPOB) showed on Friday.
Cargo surveyor Societe Generale de Surveillance (SGS) estimated exports of Malaysian palm oil products for Nov. 1-10 at 404,074 tons.
The Malaysian ringgit MYR=, palm’s currency of trade, is strengthening at 1.23% against the dollar. A weaker ringgit makes palm oil more attractive for foreign currency holders.
Source: Reuters (Reporting by Dewi Kurniawati; Editing by Rashmi Aich)