Export data from surveyors show palm gains on Dalian

The price of Malaysian palm oils futures rose for the second consecutive session on Thursday. This was due to the strong performance in Dalian and the newly released export surveyors data.

The benchmark contract for palm oil delivery in June on the Bursa Derivatives exchange gained 26 ringgit or 0.59% to $4,415 ringgit (US$997.97) per metric ton.

A Kuala Lumpur based trader stated earlier that the futures rose due to Dalian, while awaiting export data which would lead the market in the afternoon.

Dalian's most active palm oil contract grew by 0.93%, while the soyoil contract that was traded fell 0.62%. The Chicago Board of Trade's (CBOT's) soyoil price fell 0.73%.

As palm oil competes to gain a share in the global vegetable oil market, it tracks the price changes of competing edible oils.

Intertek Testing Services, a cargo surveyor, reported that exports of Malaysian products containing palm oil for the period March 1-20, fell by 14.2%, according to AmSpec Agri Malaysia, an independent inspection company.

A plantation fund official announced on Tuesday that Indonesia would increase its palm oil export tax to 4.5%-10% from the current 3%-7.5% in order to fund a mandated rise in the amount used to make biodiesel.

A circular posted on the website of the Malaysian Palm Oil Board stated that Malaysia had maintained its export tax for crude oil in April at 10%, and increased its reference price.

The oil prices rose on Friday, thanks to a stronger dollar and an optimistic outlook for the demand in the United States, after fuel inventories dropped more than expected.

Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.

The palm ringgit's currency has strengthened by 0.16% against U.S. dollars, increasing the price of the commodity for buyers who hold foreign currencies.

(source: Reuters)