Palm oil prices rise on the back of bargains, and Dalian oils are stronger

The price of Malaysian palm oils rose slightly on Thursday due to bargain-buying and the strength of rival Dalian oils.

At midday, the benchmark palm oil contract on Bursa Derivatives Exchange for February delivery rose by 6 ringgit or 0.13% to 4,804 Ringgit ($1,081.49) per metric ton.

The contact increased by 3.36% in the last three sessions.

Anilkumar bagani, Sunvin Group's research head, stated that the supply of palm oil is still tight, and this has led to a recovery in crude palm oil futures.

Separately, Kuala Lumpur based traders said that the overnight sell-off in Chicago soyoil spilled over to crude palm oil futures today, but price movements in Dalian oils rivals capped the prices from further falling.

Dalian's palm oil contract grew by 1.46%, while the most active soyoil contract increased by 0.05%. Chicago Board of Trade closed on Thanksgiving Day.

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

Oil prices fell in Asian trading after a sudden surge in gasoline stocks in the United States ahead of Thanksgiving sparked concern in the country's largest consumer.

Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.

The palm ringgit's currency has weakened by 0.05% compared to the U.S. Dollar, lowering the price of the commodity for foreign buyers.

Technical analyst Wang Tao stated that palm oil could retrace to the range of 4,679-4731, ringgits per metric tonne, as it faces resistance around 4,868 ringgit.

(source: Reuters)