Malaysian palm oil futures surged to a six-week high on Wednesday evening, recording a fourth consecutive session of gains, as improved demand and a recovery in rival US soya supported prices. Palm has pared some losses in the last three trading sessions, after falling to a one-week low, tracking weaker rival oils on China's Dalian Commodity Exchange.
Benchmark palm oil futures for October delivery on the Bursa Malaysia Derivatives Exchange gained 3.3 percent in evening trade, its strongest gains in 10 months, settling at 2,415 ringgit ($595) per tonne at the end of the day. It earlier rose to an intraday high of 2,419 ringgit, palm's strongest levels since June 21.
Traded volumes stood at 43,803 lots of 25 tonnes each on Wednesday evening, slightly below the 2015 average of 44,600.
One trader said the market was lifted by stronger short-term demand, while another said palm also rose on a weaker ringgit and better performing US soya on the Chicago Board of Trade. "The recovery in US soya, which lifted China's Dalian Commodity Exchange, and a weaker ringgit helps as well," the trader said.
A weaker ringgit usually supports palm, as it makes the tropical oil cheaper for foreign currency holders. It weakened 0.7 percent to 4.0560 per dollar on Wednesday evening.
Palm typically tracks the performance of its rival oilseed soya, as they both compete for a share in the global vegetable oils market.
The Chicago soyabean oil contract for December was up 1.4 percent, while the most active November soyabean contract rose 0.9 percent on bargain hunting after falling to near four-month lows.
The January soyabean oil contract on Dalian was up 0.7 percent.
Palm oil shipments from Malaysia, the world's second-largest producer, rose 12-15 percent in July from June, supported by better demand from China and Europe.
Comments
Comments are closed.