KUALA LUMPUR: Malaysian palm oil futures reversed early losses on Friday to record a second consecutive weekly rise, as traders covered short positions ahead of exports data due on Monday.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange closed 43 ringgit, or 1.19%, higher at 3,646 ringgit ($822.10) a tonne, after a two-day decline.
For the week, the contract rose 1.25%.
There was some short covering ahead of the weekend and May 1-15 export shipment data next week, traders said.
The contract had earlier lost 1.47%, before retracing.
“Rumours of higher production for May in Indonesia is lingering in the market and players are also cautious on weak energy market,” a Kuala Lumpur-based trader said.
Indonesia’s palm oil exports, including refined products, rose 9% annually to 2.64 million tonnes in March, data from industry group, the Indonesian Palm Oil Association, showed.
India’s palm oil imports in April slumped 30% from the prior month to hit a 14-month low, as the premium over rival soft oils prompted buyers to shift to sunflower oil and soyoil, the Solvent Extractors’ Association of India said.
Oil prices slipped, heading for a fourth weekly decline, as renewed economic concerns in the United States and China revived concern about fuel demand growth in the world’s two largest oil consumers.
Weaker crude futures make palm a less-attractive option for biodiesel feedstock.
In related oils, Dalian’s most active soyoil contract fell 1.5%, while its palm oil contract lost 2.6%. Soyoil prices on the Chicago Board of Trade were up 0.5%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
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