Malaysian palm oil gained 2.2 percent by the end of Tuesday's trading day, buoyed by data showing a slower decline in exports and improved sentiment for rival oils on Dalian and CBOT. Benchmark palm oil futures for March delivery on the Bursa Malaysia Derivatives Exchange rose to 3,128 ringgit ($699.29) per tonne. It earlier reached an intraday high of 3,134 ringgit, and charted its biggest daily gain in a month and a half.
Last week, the contract logged a 3.2 percent decline, the biggest loss in four weeks. Traded volumes were thin with 36,764 lots of 25 tonnes each changing hands. A trader based in Kuala Lumpur said although many traders have yet to return from their holidays, the market has responded positively to the export figures released on Monday.
Exports of Malaysian palm oil products for December 1 - 25 fell 5.6 percent to 845,441 tonnes from 895,625 tonnes shipped during November 1 - 25, cargo surveyor Intertek Testing Services said on Monday. The data for December 1 - 20 showed a 14.4 percent decline and had dragged down the market at the time. "Exports are still down but have improved. Dalian has also been recovering the last two days," the trader said. "With better external markets and local support, the market is on a plus."
The trader saw an immediate support level for the palm futures at 3,100 ringgit, with a resistance at 3,140 ringgit. Another trader said the Chinese are gearing up their purchases ahead of the lunar new year celebrations at the end of January, pushing palm up. "Indeed, the restocking activities in China seems to be bullish for the market. As export demand is robust coupled with lower production, looks like a bullish picture is forming," the trader said. The May contract for Dalian soyabean oil climbed 1.8 percent, while the palm olein contract rose 2.6 percent. On the Chicago Board Of Trade, the March soyabean oil contract was up 1.3 percent.
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