Palm oil snaps 3-day losing streak to settle higher
08/08/2024 (Reuters), Kuala Lumpur - Malaysian palm oil futures edged higher on Thursday after a three-day losing streak, buoyed by stronger rival Dalian contracts, though weaker crude oil prices and a firmer ringgit currency capped the gains.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange closed 5 ringgit, or 0.14% higher, at 3,702 ringgit ($828.19) a metric ton.
The contract had closed near seven-month lows in the previous two sessions.
With a calmed dollar-ringgit volatility this week, gains in crude oil due to the renewed Middle East crisis, and Indonesia discussing increasing the biodiesel mandates, palm oil may find support around the 3,650 ringgit range, said Sandeep Singh, director of The Farm Trade, a Kuala Lumpur-based consulting and trading firm.
Dalian’s most-active soyoil contract rose 0.78%, while its palm oil contract added 0.16%. Soyoil prices on the Chicago Board of Trade were down 0.76%.
Palm oil extends losses on weaker rival Dalian, Chicago contracts
Palm oil tracks price movements of rival edible oils, as they compete for a share of the global vegetable oils market.
Oil prices held steady on Thursday after two sessions of gains, with growing supply risks in the Middle East offsetting demand concerns that had pushed prices to their lowest since early 2024 at the start of the week.
Brent crude futures LCOc1 fell 16 cents, or 0.2%, to $78.17 a barrel by 0903 GMT. Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, the palm’s currency of trade, strengthened 0.49% against the dollar, making the commodity more expensive for buyers holding foreign currencies.