SINGAPORE, Oct 22: Malaysian palm oil futures rose to their highest in more than three weeks on Monday, boosted by rising exports which investors said may help ease record stocks in the world’s No.2 palm oil producer.
Latest data from cargo surveyor Societe Generale de Surveillance showed Malaysia’s palm exports rose 16.7 per cent for the first twenty days of October from a month ago, lending support to futures that have lost almost one-fifth so far this year. Another cargo surveyor Intertek Testing Services reported on Saturday a 14.1 per cent increase in exports to 1.06 million tons for the same period, signalling buoyant demand for the tropical oil.
“The export numbers improved market sentiment. It’s good to see positive signs after seeing so many negative signs lately,” said a Singapore-based trader with a global commodities house.
“Prices are very likely to go to the 2,700-2,800 ringgit range but there may be dips in between.” At the close, the benchmark January contract on the Bursa Malaysia Derivatives Exchange rose three per cent to 2,577 ringgit ($845) per ton, just off an intraday high at 2,580 ringgit, a level unseen since Sept. 28.
Total traded volumes stood at 37,259 lots of 25 tons each, much higher than the usual 25,000 lots. Palm oil prices fell to a near three-year low earlier this month on fears over rising stocks and concerns that a sluggish global economic growth could hurt commodity demand.
But traders said low prices could lure buyers back to the market and also make the tropical oil an attractive choice to be used as bio diesel.
In other vegetable oil markets, the US soyoil for December delivery increase 1.1 per cent in late Asian trade, drawing support from the Chicago soybeans market, which bounced back from a three-and-half month low last week. —Reuters