KUALA LUMPUR: Malaysian palm oil futures rose on Tuesday, reversing a slide to its weakest since mid-August earlier in the day, after top buyer India raised its import duties on vegetable oils.

India lifted the import tax on crude palm oil to 30 per cent from 15pc and increased import tax duty on refined palm oil imports to 40pc from 25pc.

The benchmark palm oil February contract on the Bursa Malaysia Derivatives Exchange ended at 2,635 ringgit ($636.78) a tonne, up 0.2pc.

Earlier in the day, it slid to 2,612 ringgit a tonne, its weakest since August 16. Traded volume stood at 73,347 lots of 25 tonnes each.

“The market is up on profit taking now, after seeing a downside for too long,” said a futures trader from Kuala Lumpur. The trader added he expected the market to get some support from production, which has seen harvesting disruptions from year-end monsoon rains.

Industry analyst Dorab Mistry said on Tuesday that Malaysian palm oil futures will likely fall a further 2-3pc after India raised its import duties.

India’s edible oil imports are likely to drop to 15.5 million tonnes this year, down from an earlier estimate of 15.9m tonnes.

Published in Dawn, November 22nd, 2017