Palm oil tracks Dalian oil higher and sets for second consecutive weekly loss
Malaysian palm futures were up on Friday as they tracked the movement of rival oils in the Dalian Market. However, the market is set to drop for the second consecutive week while it awaits the inventory data from Malaysian Palm Oil Board.
By midday, the benchmark palm oil contract on Bursa Derivatives Exchange for May delivery had risen 42 ringgit (0.94%) to 4,522 Ringgit ($1,021.23) per metric ton.
Futures prices have fallen 0.70% this week.
A Kuala Lumpur based trader said, "The futures are tracking Dalian strength as we wait for the MPOB data to be released next Monday."
On March 10, the Malaysian Palm Oil Board will release its monthly statistics.
Dalian's soyoil contract, which is the most active one, gained 1.37% on Thursday after data showed that U.S. exports of soyoil in January reached a record high for 15 years. Palm oil contracts in Dalian gained 1.67% while soyoil prices on the Chicago Board of Trade fell by 0.71%.
As palm oil competes to gain a share in the global vegetable oil market, it tracks the price changes of competing edible oils.
GAPKI (the Indonesia Palm Oil Association) released data on Thursday showing that Indonesia exported 29.5 millions metric tons of palm products in the last year. This represents an 8.3% decrease on the previous year.
A survey revealed that Malaysia's palm oil stocks in February were at their lowest level for nearly three years, due to production interruptions caused by flooding.
A minister revealed that palm oil plantations have been infested in two states of Malaysia, which is the second largest producer in the world. The country is recovering from flooding, which has disrupted its production.
The palm ringgit's trade currency, the U.S. Dollar, has weakened by 0.07%, making the commodity slightly cheaper for buyers with foreign currencies.
Technical analyst Wang Tao stated that palm oil could rise to 4,557 Ringgit per metric tonne as it has broken through a declining trendline.
(source: Reuters)
