Malaysian palm oil futures rose on Thursday

Malaysian palm oil futures rose on Thursday, posting a second consecutive gain, supported by stronger crude oil and competing edible oil prices.

The benchmark FCPO palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange rose 39 ringgit, or 0.87%, to 4,535 ringgit (US$1,140) per metric tonne at the close.

The market rose in tandem with energy prices, Chinese vegetable oil futures, and Chicago soybean oil futures, said Anilkumar Bagani, head of commodity research at Mumbai-based brokerage Sunvin Group.

“Market discussions about the super El Nino phenomenon have made traders cautious. This is currently seen as supportive for palm oil prices,” he said.

The most active soybean oil contract in Dalian rose 1.07%, while the CPO1 palm oil contract added 0.96%. Soybean oil prices on the Chicago Mercantile Exchange rose 0.54%.

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

Oil prices jumped more than 2% after Iran’s Revolutionary Guards claimed to have struck a US airbase in retaliation for an earlier US attack in the port city of Bandar Abbas.

Strengthening oil futures makes palm oil a more attractive option for biodiesel feedstock.

The ringgit weakened 0.38% against the dollar, making the commodity cheaper for buyers holding foreign currency.

Tags: Malaysia, palm oil, prices