VEGOILS-Palm oil climbs more than 3% amid supply concerns, weaker ringgit
SINGAPORE, April 18 (Reuters) - Malaysian palm oil futures rose more than 3% on Tuesday, tracking strength in related edible oils amid threats to the Black Sea grain corridor deal, while a weaker Malaysian ringgit lent some support.
The benchmark palm oil contract FCPOc3 for July delivery on the Bursa Malaysia Derivatives Exchange gained 121 ringgit, or 3.3%, to 3,759 ringgit ($847.39) a tonne by the midday break, the highest daily gain since Feb. 16.
The contract surged following a rise in global vegetable oil markets overnight, triggered by concerns that the Black Sea Grain corridor deal might not extend beyond May 18, said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.
"The destination demand is still fragile for palm oil due to its tight spread over the competition and even the core palm oil demand is cautious due to high volatility in prices," Bagani added.
Indonesia had stocks of 2.64 million tonnes at the end of February, down 14.84% from a month earlier.
Malaysia maintained its export tax for crude palm oil at 8% for May and raised its reference price, a circular on the Malaysian Palm Oil Board website showed on Monday.
Dalian's most-active soyoil contract DBYcv1rose 1.7%, while its palm oil contract DCPcv1gained 3.0%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.7%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
The Malaysian ringgit MYR=, palm's currency of trade, weakened 0.38% against the dollar. A weaker ringgit makes palm oil more attractive for foreign currency holders.
Palm oil FCPOc3 may retest a support at 3,577 ringgit per tonne, a break below which could cause a fall to 3,520 ringgit, said Reuters technical analyst Wang Tao said. TECH/C
($1 = 4.4360 ringgit)
(Reporting by Carman Chew; Editing by Nivedita Bhattacharjee)
((carman.chew@thomsonreuters.com; +6582011860))