Palm rebounds on Dalian soyoil strength, profit taking

Malaysian palm oil futures rose on Tuesday, recovering from a near four-month low hit in the previous session, as gains in rival Dalian soyoil and profit-taking activities after a sharp fall last week.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange gained RM29, or 0.7 per cent, to RM4,144 (US$981.06) a metric ton by the midday break.

“Dalian’s soyoil strength and profit-taking supporting the rebounds today, after a sharp fall last week,” said Sandeep Singh, director of The Farm Trade, a Kuala Lumpur-based consulting and trading firm.

Palm fell sharply last week due to continuing production in Malaysia, with end-stocks expected to reach 2.5 million metric tons in October, he added.

Dalian’s most-active soyoil contract gained 0.47 per cent, while its palm oil contract shed 0.85 per cent. Soyoil prices on the Chicago Board of Trade (CBOT) gained 0.12 per cent.

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

The ringgit, palm’s currency of trade, weakened 0.12 per cent against the dollar, making palm oil more attractive to buyers holding foreign currencies.

Malaysia’s palm oil inventories are forecast to climb to a two-year high in October, driven by a surge in production to the highest level in seven years, outpacing export demand. Palm oil stocks are expected to surge 3.5 per cent in October to 2.44 million metric tons, their highest since October 2023.

India’s palm oil imports in October fell to a five-month low, dragging total purchases in the 2024/25 marketing year to their lowest in five years, as buyers switched to soyoil after a rally in palm oil prices, according to five dealers.

Indonesia exported 17.58 million tons of crude and refined palm oil in the January-to-September period, up 11.62 per cent from the same period last year, the statistics bureau said on Monday.

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