Malaysian palm oil futures rose for a second session in four on Friday as better performing rival soya oil gave the market a late boost even though a stronger ringgit weighed on prices earlier in the day. Benchmark palm oil futures for September delivery on the Bursa Malaysia Derivatives Exchange were 0.3 percent higher at 2,359 ringgit ($590) per tonne at the close of trade, recording a fourth straight weekly fall.
Traded volumes stood at 28,711 lots of 25 tonnes each on Friday, lower than the 2015 average of 44,600. "Now palm is up tracking external markets," a trader said of the evening trade, after it fell earlier on a stronger ringgit. A stronger ringgit, the currency palm oil is traded in, makes the vegetable oil more expensive for holders of foreign currencies. The local currency strengthened 0.7 percent to 3.9960 per dollar.
The Chicago Board of Trade soya oil contract for December rose 1.1 percent while the September soyabean oil contract on the Dalian Commodity Exchange surged 1.9 percent.
Palm oil has shed 0.8 percent so far this week, with traders bearish about market fundamentals. Seasonal output is expected to rise from now until the final quarter of the year, while exports are also seen slowing down until the next major festive season of Diwali in late October. Palm oil shipments from Malaysia dropped 9-11 percent in June compared with a month earlier, with a substantial drop in shipments to India, according to data by cargo surveyors. Demand for the tropical oil surges during the month leading up to Ramazan.
Technical analysis shows palm oil is heading for a target of 2,399 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals. The July offer price for crude palm kernel oil stood at 5,076.12 ringgit per tonne on Friday evening, according to price assessments by Thomson Reuters.
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