Palm surges for fourth day on lower stockpiles, possible production drop
24/10/2024 (Reuters), Kuala Lumpur - Malaysian palm oil jumped more than 2% on Thursday, supported by expectations of palm production declines and lower national stockpiles.
The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange gained 116 ringgit, or 2.59%, to 4,602 ringgit a metric ton at the close.
The contract has gained a total of 7.92% over four consecutive sessions.
Crude palm oil prices opened higher today on prospects of weaker output and likely lower overall stock levels in the country, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.
The Malaysian Palm Oil Board reported this month that crude palm oil production was down 3.8% in September from August, while palm oil exports rose 0.93%.
Dalian’s most-active soyoil contract rose 0.71%, while its palm oil contract added 1.55%. Soyoil prices on the Chicago Board of Trade were up 2.21%.
Palm oil gains on stronger Dalian rivals and weaker ringgit
Palm oil tracks prices of rival edible oils as it competes for a share of the global vegetable oils market.
Crude oil prices rose more than 1%, reversing some of the previous session’s losses, as the Middle East conflict and reports of North Korean troops ready to help Russia in Ukraine kept traders on edge ahead of the U.S. presidential election.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, strengthened 0.05% against the U.S. dollar, making the commodity more expensive for buyers holding foreign currencies.
Cargo surveyors are expected to release Malaysian palm oil export estimates for Oct. 1-25 on Friday.