By Mei Mei Chu
KUALA LUMPUR, Jan 21 (Reuters) – Malaysian palm oil futures rose on Friday and were set for a fifth consecutive weekly climb, after hitting a record high of 5,231 ringgit ($1,249.94) during overnight trade.
The benchmark palm oil contract FCPOc3 for April delivery on the Bursa Malaysia Derivatives Exchange rose 29 ringgit, or 0.56%, to 5,216 ringgit ($1,246.80) a tonne by the midday break.
For the week, it has risen 1.8% so far.
“Futures raced higher in the last two days underpinned by euphoria over Indonesia soft controls on exports,” said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
But the contract is showing signs of running out of stamina from profit taking and on adjustment to soybean oil pricing, he added.
Indonesia’s plan to limit palm oil exports that has driven prices to record highs is likely to make leading importer India shift to substitute soy and sunflower oils, potentially capping the market’s rally, industry officials and analysts said.
Exports of Malaysian palm oil products for Jan. 1-20 fell 43.1% to 626,029 tonnes from Dec. 1-20, cargo surveyor Societe Generale de Surveillance said.
Dalian’s most-active soyoil contract DBYcv1 rose 1.1%, while its palm oil contract DCPcv1 gained 0.6%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.9%, after jumping 3.5% overnight.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil looks shaky around a previous high of 5,220 ringgit per tonne. It may test a support at 5,174 ringgit, Reuters technical analyst Wang Tao said. TECH/C
($1 = 4.1835 ringgit)
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(Reporting by Mei Mei Chu; Editing by Shounak Dasgupta)
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