Malaysian crude palm oil futures ended up on Thursday, boosted by India's decision to cut import duties on vegetable oils, dealers said. The benchmark third-month April contract on the Bursa Malaysia Derivatives exchange was up 24 ringgit at 1,880 ringgit a tonne ($537) after trading between 1,852 ringgit and 1,880 ringgit.
Other traded contracts were up between 1 and 24 ringgit. Overall volume was 11,013 lots of 25 tonnes each against Wednesday's 12,770 lots. "The market was up today because India has reduced import duties," a Malaysian dealer in Kuala Lumpur said.
India, the world's third-largest importer of vegetable oils, cut import duties on palm and sunflower oil products on Wednesday in a bid to cool rising inflation. Import duties on crude palm oil and palmolein were reduced to 60 percent and those on refined, bleached and deodorised palm oil and palmolein were cut to 67.5 percent.
Palm oil from Malaysia and Indonesia competes with soybean oil from South America for a share of Indian vegetable oil imports of around 5 million tonnes a year. The Kuala Lumpur market could move in a range of between 1,860 ringgit and 1,900 ringgit on Friday, Malaysian dealers said.
But investors should keep a close eye on the weather in the next few days, they said. "According to the Meteorological Service Department, which is a government body, there could be another, third wave of floods coming in," a Kuala Lumpur-based dealer said.
"They said that moderate to heavy rain is going to be expected from now to this weekend. There are fears of the thrid wave of flood in southern and eastern Malaysia," he said. "It could be supportive to the market." Flooding cut Malaysian crude palm oil output by 26.3 percent to 1.14 million tonnes in December from a month earlier, according to state-run Malaysian Palm Oil Board.
Comments
Comments are closed.