Malaysian palm oil futures on Friday rose to its highest in nearly seven months before giving up gains as a stronger ringgit weighed on the market.
The benchmark palm oil contract for April delivery was down 0.1 percent at 2,294 ringgit ($556.46) a tonne at the close of trade on the Bursa Malaysia Derivatives Exchange, snapping five days of gains.
It had risen earlier by 0.4 percent to an intraday high of 2,307 ringgit, its strongest since July 5. Palm is also up 3 percent for the week.
Trading volumes stood at 22,116 lots of 25 tonnes each at the end of the trading day. <1FCPO-TOT>
"The market is reacting towards the stronger ringgit," one Kuala Lumpur-based futures trader said, adding that the market was generally bullish on rising demand.
"Demand is strong so stocks will drop, though they will still be relatively high."
Strength in the ringgit, palm's currency of trade, usually makes the edible oil more expensive for foreign buyers. The ringgit strengthened 0.5 percent to 4.1225 against the dollar on Friday evening.
Another trader estimated that gains in Malaysian exports in January will be driven by Indian demand for palm olein.
"The palm market is still on an overall uptrend," he said.
India, the world's largest importer of edible oils, this month lowered the duty on crude palm oil imports to 40 percent from 44 percent and a tax on refined oils was trimmed to 50 percent from 54 percent.
Malaysian shipments of refined palm oil, however, will be taxed at 45 percent compared with 54 percent previously.
in related oils, the Chicago March soybean oil contract rose 0.3 percent, while the May contract on the Dalian Commodity Exchange edged up by 0.1 percent.
The Dalian January palm oil contract, meanwhile, firmed by 0.2 percent.
Palm oil prices are affected by movements in soyoil rates because both compete in the global vegetable oil market.