Palm firms track rival oils
The price of palm oil in Malaysia rose again on Tuesday, reaching its highest level in almost three months. This was due to the gains made by rival vegetable oils as well as a weaker currency.
The benchmark palm-oil contract for September delivery at the Bursa Derivatives Exchange rose 78 ringgit or 1.92% to 4,149 Ringgit ($979.23), a metric tonne, as of closing.
A Kuala Lumpur based trader reported that the market rose on the strength of Dalian palm and Chicago soyoil.
Dalian's palm oil contract, which is the most active contract, grew by 2.34%. Chicago Board of Trade soyoil prices rose 0.5%.
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price fluctuations of competing edible oils.
GAPKI, an industry group, estimated that Indonesian palm oil exports could fall between 15% and 20% if President Donald Trump's tariffs on reciprocity are implemented.
The palm ringgit's trade currency, the dollar, fell by 0.17%, making the commodity more affordable for buyers who hold foreign currencies.
The oil price eased on Monday after a nearly 2% rise in the previous session as investors assessed recent developments regarding U.S. Tariffs and a larger-than-expected OPEC+ production increase for August.
Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.
(source: Reuters)
