Palm tracks soyoil higher, rises to highest since 2011

KUALA LUMPUR: Malaysian palm oil futures traded higher on Monday, as rival soyoil rallied on concerns over disruptions to Argentina supply.

The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange rose 87 ringgit, or 2.42%, to 3,687 ringgit ($922.67) a tonne in early trade, hitting its highest since March 2011.

Palm marked its second year of growth in 2020 last week, as demand remained firm amid tightening supplies due to unfavourable weather and infrastructure issues.

Argentina's grain inspectors' union, Urgara, said last week its members would continue to strike over the weekend after failing to strike a wage deal.

Dalian's soyoil contract rose 2.23%, and its palm oil contract climbed 2.22%. Soyoil prices on the Chicago Board of Trade were also up at 1.15%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Palm oil may rise to 3,757 ringgit per tonne after breaking a resistance at 3,679 ringgit, Reuters market analyst for commodities and energy technicals Wang Tao said.

FUNDAMENTALS

Chicago soybean futures kicked off 2021 with a bullish tone, climbing to their highest since June 2014 on Monday, as tightening South American supplies and strong Chinese demand underpinned prices.

Oil prices edged lower on Monday ahead of a meeting of OPEC and allied producers to discuss output levels for February with fears for first-half demand seeping into the market as the coronavirus pandemic lingers.

MARKETS

Asian share markets resumed their ascent on Monday as investors pinned their hope on vaccines to eventually deliver a global economic upturn, even as a possible tightening in virus rules for Tokyo pulled Japanese stocks off 30-year highs.