Palm set to gain for the first time in three weeks as export data is strong
The price of Malaysian palm oils futures increased on Friday, and they were expected to record their first weekly increase in three weeks. This was due to strong export data that supported the contract in spite of weakness in vegetable oil in Chicago and Dalian.
By midday, the benchmark contract for palm oil delivery in August on the Bursa Derivatives Market gained 6 ringgit (0.16%) to $3862 ringgit ($905.30).
The contract gained 1.26% in the last week.
A Kuala Lumpur based trader stated that "good export figures for the period of May 1-15 lent some support".
According to AmSpec Agri Malaysia, an independent inspection company and cargo surveyor Intertek Testing Services, the exports of Malaysian products containing palm oil rose between 6.6% - 14.2% from May 1 – 15.
Dalian's soyoil contract, which is the most active contract in Dalian, fell 0.84%. Palm oil for delivery in June dropped by 0.91%. Chicago Board of Trade Soyoil Prices fell 1.7%
As palm oil competes to gain a share in the global vegetable oils industry, it tracks the prices of competing edible oils.
The oil prices rose on Friday after a steep drop the previous day. This is expected to lead to a weekly increase of over 1%, as optimism about the U.S. China trade relations outweighed the prospect of Iranian supplies returning to the market.
As it has failed to hold support at 3,870 Ringgit, palm oil could continue to fall into the range of 3,763 to 3,804 Ringgit per metric tonne.
(source: Reuters)
