KUALA LUMPUR: Malaysian palm oil futures settled higher on Wednesday for a fourth straight session, as firmer Chicago soyoil and energy gains supported the market.
The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange gained 99 ringgit, or 2.24%, to 4,518 ringgit ($1,015.05) a metric ton at the close.
Crude palm oil prices were higher after the holidays in Malaysia, following a rally in Chicago soyoil futures and gains in energy prices, said Anilkumar Bagani, commodity research head at Mumbai-based vegetable oils brokerage Sunvin Group.
Bagani said U.S soybean oil prices rose after news that oil and biofuel groups will meet with the U.S. Environmental Protection Agency to advocate for higher federal mandates for biomass diesel blending, while the U.S. Department of Agriculture Secretary Brooke Rollins announced a funding of $537 million for biofuel infrastructure.
Dalian’s most-active soyoil contract rose 0.66%, while its palm oil contract added 2.04%. Soyoil prices on the Chicago Board of Trade fell 0.11%.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
Malaysian palm oil gains on strong physical demand
Oil prices were little changed as traders remained cautious ahead of U.S. tariffs due to be announced at 2000 GMT, fearing they could exacerbate a global trade war and dampen demand for crude.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
India’s palm oil imports in March increased from the previous month but remained below normal levels for the fourth consecutive month, as its premium over rival soyoil prompted refiners to boost soyoil purchases, according to five dealers.
Cargo surveyors estimate that March exports rose between 0.4% and 3.9%.
The ringgit, palm’s currency of trade, weakened 0.36% against the dollar, making the commodity cheaper for buyers holding foreign currencies.
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