Palm oil follows rival oils in higher prices
The price of Malaysian palm oils rose again on Tuesday. This was due to the weaker ringgit and gains in other vegetable oils.
By midday, the benchmark palm oil contract on Bursa Derivatives Exchange for September delivery had gained 49 ringgit or 1.2% to 4,120 Ringgit ($972.62) per metric ton.
A Kuala Lumpur based trader reported that the market rose on the strength of Dalian palm and Chicago soyoil.
Dalian's palm oil contract grew by 1.52% while the most active soyoil contract increased by 0.2%. Chicago Board of Trade soyoil prices rose 0.54%.
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price changes 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.
Palm's trade currency, the ringgit (the palm equivalent of the dollar), has fallen by 0.12%, making it cheaper for buyers with foreign currencies.
Oil prices fell after a nearly 2% rise in the previous session as investors assessed developments regarding U.S. Tariffs and a higher than expected OPEC+ production increase for August.
Palm oil is less appealing as a biodiesel feedstock due to the weaker crude oil futures.
Technical analyst Wang Tao stated that the palm oil price may test support at 4,032 Ringgit per ton as the correction from 4,108 Ringgit appears incomplete.
(source: Reuters)
