Malaysian palm oil futures rebounded on Tuesday, supported by bargain hunting after prices fell to a three-month low in the previous session, although concerns remained that demand could be hit if Greece exits the eurozone. Buying interest picked up as some traders felt that the market was oversold.
Malaysian exports for the first 15 days showed a slight improvement, reinforcing the view that palm oil fundamentals remained solid despite global economic uncertainty. "We see a small recovery today because selling was a bit overdone yesterday and exports were also slightly better," said a trader with a foreign commodities brokerage in Malaysia.
Benchmark July palm oil futures on the Bursa Malaysia Derivatives Exchange gained 2.4 percent to close at 3,226 ringgit ($1,048) per tonne. Prices closed at 3,150 ringgit on Monday, the weakest since February 13. Traded volumes stood at 34,697 lots of 25 tonnes each, much higher than the usual 25,000 lots.
Malaysian palm oil exports for first 15 days of May picked up by a slight 0.7 percent to 599,044 tonnes, according to cargo surveyor Intertek Testing Services, reflecting a still-healthy demand for the edible oil. Another cargo surveyor Societe Generale de Surveillance meanwhile reported a 7 percent drop in exports to 564,477 tonnes, thanks to lower shipments to China and India.
In the latest development of an upcoming listing of Malaysian palm oil firm Felda Global Venture Holdings (FGVH), commodities group Louis Dreyfus has agreed to take a minority stake in Felda, it said on Monday. In other vegetable oil markets, the most active US soyoil contract for July gained 0.6 percent in late Asian trade while the most active Dalian soyoil September contract was down 0.8 percent.
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