Palm oil rises on supply concerns amid India festive demand
SINGAPORE: Palm oil futures ended higher on Wednesday, as warm weather threatened the supply of palm and rival edible oils in Asia amid the high-demand festive season in India.
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange rose 80 ringgit, or 2.04% to 4,010 ringgit ($864.78) per metric ton, up for a second straight session.
The Dalian palm contract, meanwhile, climbed 0.4%.
Hot and dry weather in India has squeezed crop yields amid higher demand during the festive season, offsetting concerns from existing high port inventories, said Mitesh Saiya, trading manager at Mumbai-based firm Kantilal Laxmichand and Co.
Dalian’s most-active soyoil contract was up 0.1%, while its price on the Chicago Board of Trade rose 0.7%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
An unusually dry August has taken a toll on cereal and oilseed crops in Asia as El Nino intensified, and forecasts for lower rainfall in September are further threatening to disrupt supplies.
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