Palm oil prices rise on the back of stronger competitors and higher crude prices

Malaysian palm oils futures have reversed their early losses and closed higher on Wednesday for the second consecutive session, following the strength of 'crude oil' prices and rival edible oil.

By the close, the benchmark 'palm oil' contract for July delivery at the Bursa Derivatives Exchange had risen 42 ringgit or 0.93% to 4,578 Ringgit ($1,158.99).

Futures dropped as low as 4,491 Ringgit in intraday trading.

Dalian's palm oil contract, which is the most active contract, grew by 0.29%. Chicago Board of Trade soyoil prices were up by?0.77%.

As palm oil competes to gain a share in the global vegetable oils market, it tracks the movements of rival edible oils.

On Wednesday, oil prices rose by nearly 3%, with the Brent contract reaching a new high. This was due to media reports that the U.S. would extend its blockade against Iranian ports. This will likely lead to a prolonged disruption of supply from this key Middle East region.

Palm oil is a better option as a feedstock for biodiesel due to the stronger crude oil futures.

The head of Indonesia's palm oil producer association stated that the country's crude palm?oil output could drop by as much as 2 million metric tons this year compared to the same period in 2025, due to El Nino and high?fertiliser?prices driven by the Middle East conflict.

Exports of Malaysian palm products between April 1-25 fell between 15.7% to 16.8% from the previous month, according to cargo surveyors.

The palm?ringgit's currency, the dollar, has weakened by 0.03%, making the commodity slightly cheaper for buyers with foreign currencies.

(source: Reuters)