Malaysian palm oil prices rise on strong rival edible oils and Indonesia levy plans
Malaysian palm oil futures rose for a third straight session, heading for a weekly gain as rival edible oil prices strengthened and Indonesia’s plan to raise export levies boosted Malaysia’s export outlook. Higher crude oil prices also supported biodiesel-linked demand.
Malaysian palm oil futures extended gains for a third consecutive session and are heading for a weekly increase, supported by rising prices of competing edible oils and Indonesia’s plans to raise its palm oil export levy.
The benchmark March palm oil contract on the Bursa Malaysia Derivatives Exchange climbed 35 ringgit, or 0.87%, to 4,078 ringgit per metric ton by midday on Friday. The contract has gained 2.18% so far this week.
According to Anilkumar Bagani, head of commodity research at Sunvin Group, a potential increase in Indonesia’s export levy would support Malaysia’s palm oil export prospects. Indonesia is considering the move to help finance its biodiesel mandate amid tightening funds.
Additional support came from gains in rival edible oils and crude oil prices. The most-active soyoil contract in Dalian rose 0.25%, palm oil futures in Dalian increased 0.42%, while soyoil prices on the Chicago Board of Trade gained 0.73%.
Palm oil prices typically track movements in other vegetable oils as they compete for a share of the global edible oils market. At the same time, higher crude oil prices are making palm oil more attractive as a feedstock for biodiesel, providing further support to the market.
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Source : Ukr Agro Consult
