Palm oil futures saw an increase for the second day in a row on Wednesday, bolstered by gains in vegetable oil contracts on the Dalian Commodity Exchange. The February delivery contract on the Bursa Malaysia Derivatives Exchange rose by 47 ringgit, or 0.93%, to reach 5,122 ringgit ($1,148.17) per metric ton. Traders are closely monitoring the strength of Dalian vegetable oil contracts for further market guidance.
The Dalian palm oil contract gained 1.07%, while the soyoil contract saw a modest rise of 0.05%. In contrast, soyoil prices dropped 0.57% on the Chicago Board of Trade. Despite the upward movement, the rally in palm oil was somewhat tempered by a weakening in Chicago soyoil prices and a stronger Malaysian ringgit, which appreciated by 0.13% against the US dollar. A stronger ringgit makes palm oil less appealing for foreign buyers.
India’s edible oil imports surged to a four-month high in November, with refiners increasing their purchases of palm oil, soyoil, and sunflower oil to rebuild inventories following high demand during the festival season. Meanwhile, Malaysia’s palm oil exports in November are projected to decrease by 9.3% to 10.4%, according to cargo surveyors Intertek Testing Services and AmSpec Agri Malaysia.
Indonesia has raised its crude palm oil reference price for December to $1,071.67 per metric ton, up from $961.97 in November, which results in an increase in the export tax to $178 per ton. Palm oil is expected to challenge its November 11 high of 5,202 ringgit per metric ton as it has surpassed resistance at 5,124 ringgit.
The market outlook remains bullish, but external factors like the strengthening ringgit and shifts in soyoil prices will continue to influence future movements.
Dekel Agri-Vision PLC (LON:DKL) aspires to become a leading agro-industrial company in West Africa, one that creates value for shareholders whilst at all times placing the interests of the local communities and environment in which it operates in at the heart of its operations.
