Palm closes over 2% lower but posts weekly gain
Malaysian palm oil futures fell by 2.41% due to a stronger ringgit, which made palm oil more expensive for buyers using foreign currencies. This drop came after a seven-session rally, but the market still posted a weekly gain of 5.19%. Profit-taking by traders also contributed to the decline. Despite this, a rebound in Chicago soybean prices offered some support.
KUALA LUMPUR: Malaysian palm oil futures ended more than 2% lower on Friday, snapping a seven-session rally due to a stronger ringgit, but still achieved a weekly gain.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange fell 100 ringgit, or 2.41%, to close at 4,052 ringgit ($983.02) a metric ton.
The contract logged a weekly gain of 5.19%.
Palm oil prices fell due to a stronger ringgit, which may curb demand in the short-term, said David Ng, a proprietary trader at a Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.
Traders are also closing out their positions and booking profits amid the recent price rally, further weighing on Malaysian palm oil futures, Ng said.
“However, the rebound in Chicago soybean prices is lending some strength to the palm market from falling lower.”
The ringgit, palm’s currency of trade, strengthened 0.43% against the U.S. dollar, making the commodity more expensive for buyers holding foreign currencies.
Palm oil rises for 6th session, closes at highest level in nearly 3 months
Dalian’s most-active soyoil contract rose 0.22%, while its palm oil contract added 1.27%. Soyoil on the Chicago Board of Trade fell 0.84%.
Palm oil tracks prices of rival edible oils, as they compete for a share of the global vegetable oils market.
Oil prices held on Friday, but remained on track for a weekly fall as investors weighed expectations for increased output from Libya and the broader OPEC+ group against fresh stimulus from top importer China.
Weaker crude oil makes palm a less attractive option for biodiesel feedstock.
Source Link : https://www.brecorder.com/news/40324369/palm-closes-over-2-lower-but-posts-weekly-gain
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