JAKARTA: Malaysian palm oil futures closed higher on Monday, tracking strength in rival soyoil on Dalian and Chicago markets.
The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange rose 113 ringgit, or 2.57%, to 4,504 ringgit ($999.11) a metric ton at the close. “Today’s market is tracking external performance of Dalian and Chicago soyoil,” a Kuala Lumpur-based trader said.
Dalian’s most-active soyoil contract rose 2.81%, while its palm oil contract added 3.16%. Soyoil prices on the Chicago Board of Trade were up 0.35%. Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market. China’s soybean oil and meal futures logged their biggest daily rise since 2023 on Monday, while rapeseed meal and palm oil contracts also jumped, following a rally in the Chicago soy complex after the release of bullish USDA crop reports.
The US Department of Agriculture (USDA) last Friday projected less-than-expected US soybean production and lowered its soy ending stocks due to a dry end to the growing season, sending Chicago soybean and soyoil prices to multi-month highs.
Malaysia’s palm oil stocks declined for a third straight month in December, falling 6.91% to 1.71 million metric tons, while crude palm oil production fell 8.3% and exports plunged 9.97%, data from the Malaysian Palm Oil Board showed on Friday.
Cargo surveyors estimated that Malaysian palm oil exports fell between 21.4% and 26.8% during the Jan. 1-10 period. Oil extended gains for a third session on Monday, with Brent crude rising above $80 a barrel to its highest in more than four months, driven by wider US sanctions on Russian oil and the expected effects on exports to top buyers India and China. Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
The Malaysian ringgit, palm’s currency of trade, fell 0.33% against the US dollar, making the commodity cheaper for buyers holding foreign currencies.
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