Malaysian crude palm oil futures rebounded by nearly one percent on Tuesday, following a sell-off a day that sent prices to six-month lows.
Sentiment remained cautious because prices of rival soyaoil have not recovered from selling that hit the Chicago Board of Trade (CBOT), dealers said.
The benchmark August crude palm oil contract on the Malaysia Derivatives Exchange reached an intrude peak of 1,700 ringgit up 30 on the day before closing 15 ringgit higher at 1,685 ringgit.
Turnover were 5,297 lots, just about half of Monday's. "Some people came out to cover because they felt the market was oversold yesterday," said a trader.
"But that doesn't mean we're on solid footing because soyaoil is still down." CBOT soyaoil futures settled 0.95 to 0.15 cent per lb lower overnight, with the key July contract down 0.50 at 29.60 cents.
Soya and palm compete for the same export markets and their prices often move in step.
Palm oil's benchmark contract has lost more than 150 ringgit over the last week following a slash in soyaoil prices. On Monday alone, August futures closed 85 ringgit down.
At one stage they were close to being 100-ringgit limit-down. Dealers pegged support for August at 1,670 ringgit until the release on Thursday of palm oil export estimates for May 1-20.
The market's main cargo surveyor, Society Generale de Surveillance, said on Monday that Malaysian palm oil shipments had dropped to 479,152 tonnes for May 1-15 from 501,730 tonnes for April 1-15.
Physical May crude palm oil was quoted at 1,810/1,820 ringgit a tonne in the southern region at the close, compared with Monday's 1,805/1,810.
In the central region, the same contract was quoted at 1,810/1,815.
Trade for May was reported in the south at 1,805-1,820 ringgit and 1,805-1,817.50 ringgit in the central zone.
June CPO was quoted in the south at 1,810/1,815 and 1,805/1,1815 in the central region. Trade was reported at 1,810 in the south.
PALM OIL FUTURES:
May (south): 1820.
Open/High/Low.: 1680/1700/1671.
Previous closes: 1810.
PALM OIL PHYSICALS:
August (3rd month): 1685.
Previous settlement: 1670.
FUTURES: Benchmark third-month August up 15 ringgit at 1,685 ringgit ($443.42) a tonne.
PHYSICALS: Also rebounded.