JAKARTA: Malaysian palm oil futures climbed on Thursday, helped by estimated lower November stocks in the country, the world’s second-largest palm oil exporter.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange gained 106 ringgit, or 2.11%, to 5,138 ringgit ($1,161.13)a metric ton at closing. Malaysia’s palm oil inventories are forecast to have fallen to 1.79 million tons in November, a second consecutive monthly drop, as torrential rains disrupted production, a Reuters survey showed.
“The decline in stocks in November could lead the 2024 end stocks for Malaysian palm oil below 2 million tons, which would be a bullish sign for the palm oil price front going in to 2025,” said Anilkumar Bagani, commodity research head at Mumbai-based Sunvin group.
Low stocks in Malaysia would be bullish for palm, as Indonesian palm oil export is expected to be tight due to its upcoming B40 biodiesel mandate and Ramadan holidays in the first quarter next year, he added. Key palm oil areas in Indonesia, the world’s largest palm oil producer, recorded surplus rainfall, which triggered landslide and hindered harvesting activities in some areas, while elsewhere, moderate rainfall patterns have sustained healthy palm growth, Bagani said.
Dalian’s most-active soyoil contract slipped 0.3%, while its palm oil contract fell 1.04%. Soyoil rose 0.72% at the Chicago Board of Trade. Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.
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