KUALA LUMPUR: Malaysian palm oil futures jumped more than 3 percent on Tuesday to their highest in nearly two weeks as the ringgit slid and overseas soyoil markets tracked by palm underpinned sentiment.

The benchmark July contract on the Bursa Malaysia Derivatives exchange rose as much as 3.1 percent to 2,168 ringgit ($601) a tonne, its highest since April 24, on reopening after a long weekend. It settled at 2,156 ringgit, up 2.6 percent, by the day’s close.

After strong gains last week, the Malaysian ringgit slumped on Tuesday, touching 3.6100 per dollar, which helped stoke buying interest from overseas palm investors. The currency was down 1.4 percent at 3.6090 by 1026 GMT, marking its biggest intraday drop in nearly five months.    

“Previously, the market was under pressure because the ringgit went up so much…  but people’s idea is that the ringgit will not stay strong for so long,” said a trader with a foreign commodities brokerage in Kuala Lumpur.     

“Palm prices will find a new balance – they will move up to a slightly higher level because soy has also gone up quite a bit.”    

The U.S. July soyoil contract rose 0.2 percent in late Asian trade, while the most active September soybean oil contract on the Dalian Commodity Exchange gained 1.9 percent.     

The rally in soyoil, which stemmed from talk of rising demand on the export market and increased appetite for the vegetable oil, also drove up U.S. soybean futures to $9.79-1/4 a bushel.      

Palm oil typically tracks soyoil, a common food and fuel rival.     

Total traded volume on Tuesday stood at 49,664 lots of 25 tonnes each, higher than the usual 35,000 lots.         

Technicals, however, painted a bearish outlook. Palm oil is expected to fall to 2,114 ringgit per tonne, as indicated by its wave pattern and a Fibonacci projection analysis, according to Reuters market analyst Wang Tao.                          

In other markets, Brent crude oil steadied above $66 a barrel on Tuesday, just below its 2015 high, after protesters shut down the eastern Libyan oil port of Zueitina, hampering exports.

Palm, soy and crude oil prices at 1029 GMT
                                                                                                                                                 
  Contract        Month    Last   Change     Low    High  Volume
  MY PALM OIL      MAY5    2136   +66.00    2120    2136      91
  MY PALM OIL      JUN5    2160   +55.00    2143    2171    3236
  MY PALM OIL      JUL5    2156   +54.00    2139    2168   28708
  CHINA PALM OLEIN SEP5    5050  +106.00    4984    5092 1182844
  CHINA SOYOIL     SEP5    5878  +110.00    5816    5934 1425754
  CBOT SOY OIL     JUL5   32.69    -1.40   32.58   32.90   11922
  INDIA PALM OIL   MAY5  443.90    -1.40  443.10  447.40    1050
  INDIA SOYOIL     JUN5  597.85    +2.15  594.50  600.50   44820
  NYMEX CRUDE      JUN5   59.41    +0.48   58.63   59.52   24220
                                                                                                                                                 
  Palm oil prices in Malaysian ringgit per tonne
  CBOT soy oil in U.S. cents per pound
  Dalian soy oil and RBD palm olein in Chinese yuan per tonne
  India soy oil in Indian rupee per 10 kg
  Crude in U.S. dollars per barrel

    
($1 = 3.6090 Malaysian ringgit)
($1 = 6.2062 Chinese yuan)
($1 = 63.49 Indian rupees) – Reuters

Source : The Star

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