Palm snaps two-day loss streak due to short-term supply and demand outlook
Malaysian palm-oil futures rose on Wednesday, ending a two-day loss streak. This was due to the expected supply outlook next year, and short-term demand.
The benchmark contract for palm oil delivery in January on the Bursa Derivatives exchange gained 74 Ringgit or 1.75 % to 4,313 Ringgit ($1,005.36) per metric ton.
The contract has lost 1.89% over the last two sessions.
The price of palm oil has increased today, due to an anticipated increase in supply for the first quarter 2025, and a sustained short-term market demand, according to Marcello Cultrera. He is a grains oilseeds softs broker with SSY Global.
David Mielke, senior analyst at Oil World, predicted earlier this month that palm oil production would increase by 2.3 millions metric tons between 2024-25 and the previous season.
Dalian's palm oil contract, which is the most active contract, rose 1.3% while soyoil prices increased by 1.15%. Chicago Board of Trade soyoil prices were up by 0.64%.
As they compete to gain a share in the global vegetable oil market, palm oil monitors prices of competing edible oils.
The oil price continued to decline on Wednesday, despite the fact that OPEC+ cut backs and the uncertainty surrounding what might happen next in Middle East conflict supported it.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
The palm ringgit's currency has strengthened by 0.39% against U.S. dollars, increasing the price of the commodity for buyers with foreign currencies.
Exports of Malaysian products containing palm oil rose between 14 and 15 percent from Oct. 1-15 compared to the same period last month. $1 = 4.2900 Ringgit (Reporting and editing by Ashley Tang, Sumana Nandy, and Shilpa Majumdar).
(source: Reuters)
