Palm oil tracks crude oil prices higher
Malaysian palm oil futures climbed 0.41% to 3,885 ringgit per metric ton on Thursday, buoyed by stronger crude oil prices. The uptick was tempered by softness in rival edible oils. Crude oil’s rise, signaling tighter supply, boosted palm’s appeal as a biodiesel feedstock. Meanwhile, Malaysia aims to deploy “orangutan diplomacy” to address environmental concerns surrounding palm oil. Technical analysis suggests prices could revisit 3,926-3,969 ringgit per ton.
SINGAPORE, May 9 (Reuters) -Malaysian palm oil futures roseon Thursday amid stronger crude oil prices, though the gains were capped by a dip in prices of rival edible softs.
The benchmark palm oil contract FCPOc3 for July delivery on the Bursa Malaysia Derivatives Exchange rose 16 ringgit, or 0.41% to 3,885 ringgit ($819.62) a metric ton as of 0246 GMT.
It had gained 0.39% during overnight trade.
FUNDAMENTALS
* Oil prices rose in early trade as shrinking U.S. crude inventories signalled tighter supply, and amid rising hopes that the Federal Reserve would cut interest rates by the end of the year. O/R
* Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
* Dalian’s most-active soyoil contract DBYcv1 fell 0.64%, while its palm oil contract DCPcv1 lost 0.96%. Soyoil prices on the Chicago Board of Trade BOcv1 dipped 0.05%.
* 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, was flat at 4.746 against the dollar.
* Malaysia plans to introduce “orangutan diplomacy” in its relations with major palm oil-importing countries, offering the animals as trading gifts in an effort to allay concerns about the environmental effects of growing the commodity.
* Palm oil may revisit a range of 3,926-3,969 ringgit per ton, as the rise from the May 2 low of 3,801 ringgit looks incomplete, said Reuters technical analyst Wang Tao. TECH/C
Source Link: https://www.xm.com/research/markets/allNews/reuters/palm-oil-tracks-crude-oil-prices-higher-53833990
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