KUALA LUMPUR: Malaysian palm oil futures rose more than 0.7 per cent on Monday, after traders said the market was oversold last week.

The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange climbed to 1,986 ringgit ($474.33) per tonne. Trading volumes stood at 47,946 lots of 25 tonnes each at the close of trade.

Traders said the market was stabilising after sell-offs last week, although inventory and production concerns remain.

“Market is stabilising and inching higher after being oversold,” a Kuala Lumpur-based trader said.

The futures contract slid in eight out of the last 10 sessions, hitting its lowest level since August 2015 last week. On Friday, palm opened 4.1pc higher from Thursday only to fall 4.3pc in the same session. Another trader said despite the rebound, palm could still fall in the next session as underlying sentiment was weak.

Stockpiles at the end of October increased 7.6pc from the previous month to 2.72 million tonnes, while production rose 6pc to 1.96m tonnes, official data from the Malaysian Palm Oil Board showed last week. Inventories in top producers Indonesia and Malaysia were expected to rise for the next two months, with demand unlikely to jump from key buyers as palm oil solidifies in winter months.

In other related edible oils, the Chicago December soybean oil contract was down 0.1pc. On the Dalian Commodity Exchange, the January soybean oil contract dipped 0.3pc, while the January palm oil contract fell 1.4pc.

Published in Dawn, November 20th, 2018