Malaysian palm tracks rival edible oils higher

Malaysian palm oil futures jumped on Thursday, erasing last session’s losses, tracking stronger rival edible oils.

Meanwhile, data from Malaysian Palm Oil Board (MPOB) showed a rise in March inventories.

The benchmark June palm oil contract on the Bursa Malaysia Derivatives Exchange gained 65 ringgit, or 1.57%, to 4,213 ringgit ($941.87) a metric ton by the midday break.

“The futures react to rival oils’ rise,” a Kuala Lumpur-based trader said, adding that the export data will provide cues into the way forward.

Malaysia’s palm oil stocks at the end of March rose 3.52%from the previous month to 1.56 million metric tons, data from the MPOB showed on Thursday.

A Reuters survey had forecast inventories at 1.56 million tons, with output seen at 1.31 million tons and exports at 1.02 million tons.

Dalian’s most-active soyoil contract added 0.74%, while its palm oil contract gained 1.39%. Soyoil prices on the Chicago Board of Trade (CBOT) rose 0.61%.

Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.

Oil retreated as U.S. President Donald Trump ramped up a trade war with China even as he announced a 90-day pause on tariffs aimed at other countries.

Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

The ringgit, palm’s currency of trade, strengthened 0.47% against the U.S. dollar, making the commodity more expensive for buyers holding foreign currencies.

Tags: soyoil, Malaysia, palm oil, futures, benchmark contract