KUALA LUMPUR: Malaysian palm oil futures reversed early losses on Monday, lifted by robust exports, weaker ringgit and weather concerns.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange gained 26 ringgit, or 0.62%, to 4,228 ringgit ($944.59) a tonne.
“After experiencing calmer weather conditions last week, high rainfall patterns are expected to prevail across western regions (Peninsular Malaysia, Sumatra) in the early of March, raising flooding risks,” Refinitiv Agriculture Research said in a note. Exports of Malaysian palm oil products for Feb. 1-25 rose between 15.3% and 25.4% from the same week in January, cargo surveyors said on Saturday.
The ringgit, palm’s currency of trade fell 0.97% against the dollar to its lowest since Nov. 30, making the commodity cheaper for holders of foreign currency.
Malaysia’s largest palm oil producing firm FGV Holdings forecast crude palm oil prices to average at 4,000 ringgit a tonne this year.
In Indonesia, an official said the world’s biggest palm oil exporter will boost efforts to ensure a scheme to replant palm oil to lift flagging yields meet a target of 180,000 hectares this year. The move comes as growers of the edible oil face increased scrutiny over sustainability. Dalian’s most-active soyoil contract slipped 0.1%, while its palm oil contract fell 0.3%. Soyoil prices on the Chicago Board of Trade were gained 0.6%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
India’s rapeseed production could remain steady in 2023 despite a record planting as yields were curtailed by frost and a heat-wave in key producing areas, farmers and industry officials told Reuters.
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