Palm set to decline monthly due to sluggish ringgit and exports.
Malaysian palm futures rebounded on Friday, tracking gains in Chicago soybean oil, but were set to suffer their largest monthly drop in 10 years due to sluggish shipments and a stronger ringgit.
After a 1% decline on Thursday, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange rose 17 ringgit or 0.42% to 4,022 Ringgit ($1,035.80).
The contract is on track to have its biggest monthly drop since April 2025.
Anilkumar bagani, head of commodity research at Mumbai-based Sunvin group, said that "Bursa Malaysia crude palm oil futures have opened gap higher following a rally overnight in Chicago soy oil?futures."
The gains are capped by the weakness of the Dalian?RBD Palm olein and Zhengzou Rapeseed Oil Futures during Asian hours, as well as the weaker Malaysian Palm Oil Export Performance between February?1-25."
Dalian's soyoil contract, which is the most active in this session, was unchanged after it gained as much as 0.66 % earlier. Palm oil fell by 0.48%. The Chicago Board of Trade soy oil price was up 0.18%, after an overnight gain of 1.8%.
As palm oil competes to gain a share in the global vegetable oil market, it tracks the price fluctuations of competing edible oils.
According to AmSpec Agri Malaysia, an independent inspection company, exports of Malaysian palm oil products fell 16.1% compared to a month ago. Intertek Testing Services estimated the decline to be 12.1%.
The Malaysian Ringgit, which is the currency used for contract trade, eased by 0.03% versus?the U.S. Dollar, but remained at its highest level since April 2018. The ringgit has gained 1.34% so far in February against the dollar.
Palm oil is more expensive for holders of foreign currencies due to the stronger ringgit.
First Resources, a palm oil company, said that it paid the Indonesian government $5.6 million "in connection with the land areas which?have been given" to?government.
Technical analyst Wang Tao stated that palm oil could break through a resistance level of 4,058 Ringgit per ton and rebound into a range between 4,076-4095 Ringgit.
(source: Reuters)
