JAKARTA: Malaysian palm oil futures traded higher on Thursday after six sessions of losses, tracking global equity and commodities markets and as the recent selloff brought down palm prices to an attractive level for buyers.
The benchmark palm oil contract for November on the Bursa Malaysia Derivatives exchange gained 3.2 per cent to 1,927 ringgit ($444.39) a tonne, its biggest one-day gain since June 1.
Traded volume stood at 64,922 lots of 25 tonnes each, well above the roughly 35,000 lots usually traded per day.
“What’s positive is that margins are good for local refiners,” said a trader in Kuala Lumpur, adding that the recent market turmoil has widened the price gap between rival bean oil and palm oil products, making them attractive for the consumer.
The palm benchmark hit its lowest level since March 2009 on Tuesday and lost 9.4pc in the six sessions to Wednesday.
A weaker Malaysian ringgit also helped the commodity as it makes palm cheaper for offshore buyers. The ringgit has been emerging Asia’s worst performing currency, losing 17pc so far this year, on weakness in global currencies and domestic woes.
Published in Dawn, August 28th, 2015
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