Palm oil closes higher than rival oils, with possible tax increases on exports in Indonesia
Malaysian palm oils futures rose Monday after three sessions of declines. They were boosted by the stronger oil prices in rival countries and the expectation that Indonesia would raise its palm oil export taxes.
At the close, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange for February delivery gained 54 ringgit or 1.16% to $4,696 ringgit (1,055.76) per ton.
Anilkumar bagani, Sunvin Group's research head, says that the Malaysian palm oil futures have opened higher after recovering rival oils in Asian trading hours.
He said that the almost certain rise in Indonesian palm oil export taxes in December 2024 had also increased the chance of a rebound in Malaysian palm futures.
Bagani predicted that Indonesia's palm-oil reference price would increase to $1073.56 a ton in December.
The crude palm oil price reference for Indonesia in November has been set at $961.97 a ton, and the export tax is $124 a ton.
Dalian's palm oil contract increased by 1.15 percent, while the most active soyoil contract dropped 0.02%. Chicago Board of Trade soyoil prices were up by 0.91%.
As rival edible oils compete to gain a share of global vegetable oil market, palm oil monitors the price movement of their competitors.
Malaysian palm oil exports dropped between 8.2% to 9.2%, according to cargo surveyors, during the period of Nov. 1-25.
Prices fell on Monday after a 6% gain last week. However, supply concerns amid rising tensions between Western nations and major oil producing countries Russia and Iran helped to keep prices stable.
Brent crude futures were down 0.68 % at $74.66 per barrel by 1007 GMT. Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.
The palm ringgit's trade currency strengthened by 0.38% against dollars, increasing the price of the commodity for buyers who hold foreign currencies.
(source: Reuters)
