Malaysian palm oil futures hit a one-week high

According to David Ng, a trader at Iceberg X in Kuala Lumpur, palm oil prices rose and closed above 4,100 ringgit per tonne as growing concerns about escalating tensions in the Middle East push up oil prices. Ng also notes that the sharp rise in oil prices is driving up palm oil prices. He forecasts palm oil prices to strengthen above 4,050 ringgit per tonne, with resistance at 4,250 ringgit per tonne.

Malaysian palm oil futures hit a weekly high on Monday and closed higher for the second consecutive session, following rising edible oil prices on the Chicago market, while rising energy prices provided additional support.

The benchmark FCPO1 palm oil contract for May delivery on Bursa Malaysia rose 104 ringgit, or 2.57%, to close at 4,146 ringgit (US$1,056.57) per metric tonne.

“Palm oil futures on Bursa Malaysia opened higher, tracking price spreads for competing oilseeds,” a Kuala Lumpur-based trader said, adding that gains in the energy sector were supporting sentiment as “supply risk concerns are heightened amid escalating tensions in the Middle East, threatening one of the world’s most important energy corridors.”

The most actively traded Dalian soybean oil contract rose 0.41%, while the CPO1 palm oil contract rose 1.62%.

Soybean oil prices on the Chicago Mercantile Exchange rose 2.55%.

Palm oil prices are tracking the price of competing edible oils as it fights for share in the global vegetable oil market.

Oil prices jumped 9% on Monday following Iran’s retaliatory attacks, which disrupted shipping in the crucial Strait of Hormuz following explosions carried out by Israel and the United States over the weekend.

Higher oil futures prices make palm oil a more attractive option for biodiesel production.

Meanwhile, Indonesia raised its export duty on crude palm oil from 10% to 12.5% ​​of the benchmark price of crude palm oil, according to a Finance Ministry decree. Officials say the move is aimed at funding the mandatory use of biodiesel.

Malaysian palm oil exports fell 21.5% in February compared to January, according to cargo inspection company Intertek Testing Services. According to independent inspection company AmSpec Agri Malaysia, exports fell 25.5%.

According to statistics released Monday, Indonesia exported 2.24 million metric tons of crude and refined palm oil in January, up 77.07% year-on-year. The value of these shipments was $2.29 billion.

Tags: prices, palm oil