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Palm oil up

February 19, 2019

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KUALA LUMPUR: Malaysian palm oil futures edged higher during Monday trade, charting a second session of gains in three days, bolstered by strength in related edible oils and expected weaker output.

The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange rose 0.6 per cent to 2,286 ringgit ($559.88) a tonne by the close. Trading volumes stood at 26,316 lots of 25 tonnes each at the end of the trading day.

“Palm’s gain is due to supportive external markets, while production figures are also negative,” said a Kuala Lumpur-based trader, referring to declining output indicated by data from a millers association. Palm oil production usually declines during the first quarter of the year in line with seasonal trends.

Monthly output in February is also expected to fall from the previous month because there are fewer working days. Output in Malaysia, the world’s second-largest producer and exporter, fell 3.9pc to 1.74 million tonnes last month, data from the Malaysian Palm Oil Board showed.

Published in Dawn, February 19th, 2019