KUALA LUMPUR: Malaysian palm oil futures closed higher on Thursday, after two sessions of declines, as India resumed purchases of the vegetable oil after a month-long pause.
The benchmark contract on the Bursa Malaysia Derivatives Exchange reversed earlier losses to stand 0.9 per cent higher at 2,606 ringgit.
Indian refiners resumed Malaysian palm oil purchases after a gap of nearly a month, contracting around 70,000 tonnes of shipments in December after Kuala Lumpur offered a $5 per tonne discount over supplies from rival Indonesia, five traders told Reuters on Thursday.
Indian refiners halted purchases from Malaysia in October, fearing New Delhi could raise import taxes or enforce other measures to curb imports after Kuala Lumpur criticised New Delhi for its actions in Kashmir.
Malaysia also signed an agreement to export more than 1 million tonnes of palm oil to South Asia next year.
“The market reacted positively to the news. There are no other bullish factors otherwise,” a trader based in Kuala Lumpur said.
Dalian’s January palm oil contract traded 1.8pc lower, while the soyoil contract fell 1.5pc. US soyoil futures on the Chicago Board of Trade fell 0.1pc.
Palm oil is affected by price movements in related oils as they compete for share in the global vegetable oils market.
Published in Dawn, November 15th, 2019