Palm gains from firmer Chicago soyoil; production concerns in Malaysia
Malaysian palm futures rose on Wednesday, for the third session in a row. This was boosted by the firmer Chicago soyoil as well as production concerns.
At midday, the benchmark palm oil contract on Bursa Derivatives Exchange for February delivery gained 36 ringgit or 0.76% to 4,771 Ringgit ($1,072.62) per metric ton.
Anilkumar bagani, Sunvin Group's research head, says that the crude palm oil futures have been trading in a range of sideways to uptrends after a sharp overnight rise in Chicago soyoil. However, the recent easing for South American soyoil is limiting the recovery.
A Mumbai-based trader also said that production in Malaysia has not picked up, and that investors are waiting to see if demand resumes in the festive months surrounding Ramadan and Lunar New Year.
Dalian's palm oil contract, which is the most active contract, rose 0.66%. Chicago Board of Trade soyoil prices rose 0.07%.
As palm oil competes to gain a share in the global vegetable oil market, it tracks price changes of competing edible oils.
Early trade saw oil prices steady as markets assessed the impact of a possible ceasefire agreement between Israel and Hezbollah and in advance of Sunday's OPEC+ summit.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
The palm ringgit's currency has strengthened by 0.18% against U.S. dollars, increasing the price of the commodity for buyers who hold foreign currencies.
Data from the European Commission showed that EU soybean imports for 2024-25, which began in early July, reached 4,95 million metric tonnes by November 24, an increase of 7% over 4.62 million tons from a year ago. EU palm oil imports, however, totaled 1,26 million tons in comparison to 1.54 million tons in 2015.
Technical analyst Wang Tao stated that palm oil could test resistance at 4,780 Ringgit per metric tonne. A break above this level would lead to gains in the range of 4,816-48,69 ringgit.
(source: Reuters)
