The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange closed at 72 ringgit, or up 2.4%, at 3,113 ringgit ($761.50), on speculation India might import more crudepalm oil to refine itself.KUALA LUMPUR: Malaysian crude palm oil futures rallied on Thursday, recouping losses suffered this week, as India’s move to restrict imports of refined palm oil boosted prices, while signs of de-escalation in Iran-U.S. tensions soothed concerns.

The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange closed at 72 ringgit, or up 2.4%, at 3,113 ringgit ($761.50), on speculation India might import more crudepalm oil to refine itself.

That was its strongest gain in five sessions. India imposed restrictions on refined palm oil and palmolein imports on Wednesday, a move sources said was a retaliation against top supplier Malaysia after its criticism of India’s actions in Kashmir and a new citizenship law.

The move would lead to a loss of market share for Malaysia in refined palm oil and spark a price war with rival supplier, Indonesia, which has traditionally been more cost competitive, the palm Oil Refiners Association of Malaysia said on Thursday.

Meanwhile, U.S. President Donald Trump on Wednesday tempered days of angry rhetoric and said Iran was “standing down” after its missile attacks at U.S. forces in Iraq left no casualties, while Tehran said the strikes “concluded” its response to the killing of military leader Qassem Soleimani.

December crude palm oil stockpiles in Malaysia likely fell 8.5% from November to their lowest in 27 months due to dry weather and lower fertiliser usage, a Reuters survey showed on Sunday.

Dalian’s most-active soyoil contract rose 2.6%, while its palm oil contract dipped 0.03%. Soyoil prices on the Chicago Board of Trade gained 0.2%. palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market. – Reuters

Source : The Star