Palm oil reaches two-week record on stronger Chicago soyoil
The price of Malaysian palm oils futures reached its highest level for two weeks on February 2, tracking the firmer Chicago soyoil. A weaker ringgit added to support.
The benchmark palm-oil contract for February delivery at the Bursa Derivatives Exchange rose 63 ringgit or 1.54% to 4,157 Ringgit ($1,006.54) per metric ton.
CPO opened higher on the morning session, thanks to news that China had purchased U.S. soya beans. The sentiment was also lifted due to higher crude oil prices, said David Ng. He is a proprietary trader with Kuala Lumpur based trading firm Iceberg X Sdn. Bhd.
Chicago soybean futures rose as traders assessed China's pace of U.S. soya bean purchases following the trade truce that Beijing and Washington reached in late October.
Dalian's palm oil contract grew 1.04%, while the most active soyoil contract rose 0.17%. Chicago Board of Trade soyoil prices increased by 0.57%.
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price fluctuations of competing edible oils.
The Malaysian Ringgit, the currency used by palm to trade its products, fell 0.07% on the day against the U.S. Dollar, making the contract more affordable for holders of foreign currencies.
GAPKI, the largest Indonesian palm oil association, said that it had not yet seen any major impacts on production following the flooding on Sumatra.
Technical analyst Wang Tao says that palm oil could retrace to the range of 4,013-4 041 ringgit for a metric ton, after failing to break through resistance at 4,121.
(source: Reuters)
