JAKARTA: Malaysian palm oil futures rose on Friday, tracking soyoil and palm oil contract at the Dalian market and a stronger ringgit.
Palm oil higher on muted production expectations
The benchmark palm oil contract for November delivery on the Bursa Malaysia Derivatives Exchange was up 9 ringgit, or 0.23%, at 3,926 ringgit ($906.07) a metric ton, as of 0232 GMT.
The contract has declined 1.46% so far this week.
Fundamentals
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Dalian’s most-active soyoil contract rose 0.34%, while its palm oil contract was up 0.97%. The Chicago Board of Trade declined 0.8%.
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Palm oil tracks price movements in related oils as they compete for a share in the global vegetable oils market.
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The Malaysian ringgit, palm’s currency of trade, gained 0.1% against the dollar. A stronger ringgit makes palm oil less attractive for foreign currency holders.
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Malaysia’s palm oil inventories are expected to have climbed to a six-month high at end-August due to lacklustre export demand, a Reuters survey showed.
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Indonesia, the biggest palm oil exporter, plans to lower export duties to improve competitiveness and raise farmers’ income.
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Malaysia’s August palm oil exports are seen at 1,376,412 metric tons, according to Amspec Agri.
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Exports of Malaysian palm oil products fell 9.9% to 1,445,442 tons in August from 1,604,578 tons in July, cargo surveyor Intertek Testing Services said.
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Oil prices edged up as investors weighed a big US crude inventories withdrawal and a delay to production hikes by OPEC+ producers against mixed US employment data.
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Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
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Palm oil may retest support at 3,864 ringgit, a break below which could trigger a fall into the 3,777-3,821 ringgit range, according to Reuters’ technical analyst Wang Tao.
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