Palm oil prices rise on the back of bargain-buying, Chicago soyoil
The price of palm oil in Malaysia has recovered on Thursday, after two consecutive sessions of losses. This is due to the strength in Chicago soyoil and bargain-buying.
By midday, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange for August delivery had gained 35 ringgit (0.91%) to $3,874 ringgit (916.71 dollars per metric ton).
Anilkumar bagani, head of commodity research for Mumbai-based Sunvin Group, said that initially, the CPO futures opened in a mixed or lower trend. However, they experienced a rebound due to bargain purchasing, after a sharp rise in energy prices, and signs of stability in Chinese oil futures.
He said that the strength of Chicago soyoil in Asian trading hours added to the support for this contract.
Dalian's palm oil contract, which is the most active contract in Dalian, was up 0.02% while soyoil was down 0.23%. Chicago Board of Trade Soyoil gained 0.35%.
As palm oil competes to gain a share in the global vegetable oil market, it tracks the price fluctuations of competing edible oils.
The Malaysian Ringgit, which is the currency used for the trade contract, has strengthened by 0.21% against U.S. Dollars, increasing the cost of the contract to foreign currency holders.
The palm oil price may test the 3,812 ringgit support level per metric ton. There is a high chance that it will fall below this and reach 3,768 ringgit.
(source: Reuters)
