VEGOILS Palm prices rise on the back of bargain-buying and production concerns

Malaysian palm futures rose on Monday, after closing at a low for 21 weeks in the previous session. Production concerns and bargain-buying outweighed pressure from an increased ringgit.

By midday, the benchmark palm oil contract on Bursa Derivatives exchange for February delivery had gained 14 ringgit or 0.34% to 4,083 Ringgit ($986.23) per metric ton. The price fell by 2% to 4,069 Ringgit on Friday, the lowest since July 4.

After the severe rains were sighted, Paramalingam Supramaniam said, "Prices following the selloff on Friday, were met with buying interests at dips."

He said that reports of flooding in various states keep prices stable. Production is expected to drop slowly from December through the first quarter 2026.

Supramaniam stated that "it is definitely delayed, but the impact of monsoons will be more apparent very soon once the major producing states begin to get more rain."

The National Disaster Agency said that more than 11,000 people have been affected in seven Malaysian states by floods caused by torrential rainfall.

Dalian's palm oil contract, which is the most active contract, fell by 1.18%. Chicago Board of Trade soyoil prices were up by 0.32%.

As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price changes of competing edible oils.

The palm ringgit's trade currency strengthened by 0.14% against dollars, increasing the price of the commodity for buyers who hold foreign currencies.

Wang Tao, a technical analyst, believes that palm oil prices could fall to a range between 3,991 and 4,034 ringgits per ton. This is due to a fifth wave. $1 = 4.1400 Ringgit (Reporting and editing by Bernadette Cristina)

(source: Reuters)