Palm oil rises on higher Malaysian export estimates; firmer ringgit caps gains
17/07/2024 (Reuters), Kuala Lumpur - Malaysian palm oil futures rose on Wednesday, buoyed by higher export estimates from the world's second-biggest producer, although a firmer ringgit capped gains.
The benchmark palm oil contract FCPOc3 for October delivery on the Bursa Malaysia Derivatives Exchange was up 10 ringgit, or 0.25%, to 3,935 ringgit ($842.25) a metric ton by midday.
The market has recovered after bullish export data and is expected to retest the 4,000 ringgit mark, a Kuala Lumpur-based trader said.
"Buying interest is expected as a shortage of palm is seen in Indonesia, while Indian buyers are aggressively looking for cargo in the coming months as palm is considerably cheaper than rival edible oils," the trader added.
Exports of Malaysian palm oil products for July 1-15 rose between 65.9% and 75.6% from a month earlier, according to cargo surveyors Intertek Testing Services and AmSpec Agri.
Cargo surveyor Societe Generale de Surveillance estimates exports of Malaysian palm oil products for July 1-15 at 786,830 metric tons, from 488,388 tons shipped during June 1-15, according to LSEG data.
Dalian's most-active soyoil contract DBYcv1 rose 0.4%, while its palm oil contract DCPcv1 gained 1.47%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.24%.
Palm oil is affected by price movements in related oils, as they compete for a share of the global vegetable oils market.
The ringgit MYR=, palm's currency of trade, firmed 0.04% against the dollar, making the commodity slightly more expensive for buyers holding foreign currencies.
Malaysia's benchmark crude palm oil futures are expected to average between 3,850 ringgit and 4,000 ringgit per ton this year, a slight increase from 2023, the Malaysian Palm Oil Association said earlier this week.
Palm oil may revisit its July 12 high of 3,991 ringgit per metric ton, as a consolidation from the July 10 low of 3,850 ringgit has extended, Reuters technical analyst Wang Tao said.
($1 = 4.6720 ringgit)