Palm oil rises for third session on Dalian strength
On Wednesday, Malaysian palm oil futures extended gains for a third consecutive session, buoyed by increases in rival oils on the Dalian exchange. The benchmark July contract rose by 24 ringgit to 3,954 ringgit per metric ton, supported by a weaker Malaysian ringgit, which declined by 0.16% against the dollar. Additionally, palm oil prices were influenced by fluctuations in crude oil futures due to concerns over weak demand indicated by increased U.S. crude and fuel stockpiles.
SINGAPORE, May 8 (Reuters) -Malaysian palm oil futures rose for a third straight session on Wednesday, tracking gains in rival oils on the Dalian exchange, while a weaker ringgit also lent support to prices.
The benchmark palm oil contract FCPOc3 for July delivery on the Bursa Malaysia Derivatives Exchange rose 24 ringgit, or 0.61%, to 3,954 ringgit ($833.56) a metric ton by 0242 GMT. It fell 0.15% in overnight trade.
FUNDAMENTALS
* Dalian’s most-active soyoil contract DBYcv1 rose 0.64%, while its palm oil contract DCPcv1 was up 1.09%. Soyoil prices on the Chicago Board of Trade BOcv1 fell 0.65% amid profit-taking.
* Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
* The Malaysian ringgit MYR=, palm’s currency of trade, weakened 0.16% against the dollar. A weaker ringgit makes palm oil more attractive for foreign currency holders.
* Oil prices fell in early Asian trading hours after market sources said that data from the American Petroleum Institute showed an increase in U.S. crude and fuel stockpiles, an indicator of weak demand. O/R
* Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
* Palm oil may break resistance at 3,926 ringgit per ton, and rise towards 3,969 ringgit, said Reuters technical analyst Wang Tao. TECH/C
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