Palm climbs on Malaysia’s biodiesel boost, stronger soyoil prices
Palm oil prices rose over 1% on Malaysia’s biodiesel expansion plans and stronger soyoil and crude oil prices. Indonesia’s exports increased, while India’s imports fell sharply due to weak demand and reduced price advantage. Currency strength and energy trends continue influencing global palm oil market dynamics.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange rose 50 ringgit, or 1.09%, to 4,620 ringgit ($1,169.62) a metric ton at the close.
Palm traded higher, drawing support from Malaysia’s biodiesel news while additional support came from a recovery in Chicago soyoil futures, said Anilkumar Bagani, commodity research head at Sunvin Group, a Mumbai-based brokerage.
Malaysia will begin producing biodiesel with a mix of 15% palm oil in June in an effort to lower diesel prices, the country’s deputy prime minister said, adding that the increase will be done in phases, with the aim of shifting to a 20% mix and potentially approaching a 50% blend within the next two to three years.
Soyoil prices on the Chicago Board of Trade were up 0.36%. The Dalian Commodity Exchange was closed for a holiday and will resume trading on May 6.
Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Oil prices rose 1%, reversing earlier losses, supported by the absence of a U.S.-Iran peace deal, even as the U.S. said it would help secure safe passage for ships stranded in the Strait of Hormuz.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, strengthened 0.43% against the dollar, making the commodity more expensive for buyers holding foreign currencies.
Indonesia exported 5.85 million tons of crude and refined palm oil in the March quarter, up 9.30% from a year earlier, statistics bureau data showed.
Meanwhile, India’s palm oil imports fell 27% to a one-year low in April, as sluggish demand from institutional buyers and a recent price rally that eroded its discount to rival oils prompted refiners to curb purchases, five dealers said.
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Source : Business Recorder
