KUALA LUMPUR: Malaysian palm oil futures rose as much as 1 per cent on Friday to their highest in more than five weeks, tracking gains in related edible oils and crude oil, while a weaker ringgit also lent support.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange, however, pared some gains to end the day up 0.7pc at 2,450 ringgit ($617.13) a tonne. Earlier in the session, it rose as much as 1.2pc to 2,462 ringgit, its highest since April 10. Palm has added 2.9pc this week in its second straight weekly gain. Trading volume stood at 38,919 lots of 25 tonnes each on Friday evening.
“The palm market is up on soyoil’s upward move last night and a strong Dalian this morning,” said a Kuala Lumpur-based trader, adding that West Texas Intermediate (WTI) futures briefly going above $72 and Brent crude futures above $80 also brought about some buying. Palm oil prices are impacted by movements in crude oil, as the edible oil is used as feedstock to make biodiesel. Crude oil prices held firm on Friday on strong demand, supply cuts led by the Organisation of the Petroleum Exporting Countries, and looming US sanctions against oil exporter Iran.
Published in Dawn, May 19th, 2018
