By Mei Mei Chu
KUALA LUMPUR, Nov 12 (Reuters) – Malaysian palm oil futures rebounded on Friday to clock a weekly rise, as investors weighed worries of slowing November production against weaker demand.
The benchmark palm oil contract FCPOc3 for January delivery on the Bursa Malaysia Derivatives Exchange closed 55 ringgit, or 1.13%, higher at 4,936 ringgit ($1,185.40) a tonne.
For the week, the contract is up 1.15%.
“Palm recovered from yesterday’s volatile trade on higher Dalian oils, bargain buying and persistent sentiment of tight supply moving into November and December,” said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics, adding the supply situation was relatively better now.
“Escalating palm prices continue to erode its discount to soft oils, making buyers pull back from booking palm cargoes,” he said.
Cargo surveyors had estimated an 8%-13% rise in Malaysian exports during Nov. 1-10, but the market is concerned shipments may dwindle as demand from key destinations like India typically shifts to soft oils during the winter months.
Indonesia, the world’s biggest palm oil maker, exported 2.89 million tonnes of the vegetable oil in September, including refined products, data from Indonesia Palm Oil Association (GAPKI) showed on Thursday.
Indonesia produced 4.57 million tonnes of palm oil in September and the domestic stock stood at 3.65 million tonnes by the end of the month, the data showed.
Dalian’s most-active soyoil contract DBYcv1 rose 0.3%, while its palm oil contract DCPcv1 gained 0.9%. Soyoil prices on the Chicago Board of Trade BOcv1 were down 0.3%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
($1 = 4.1640 ringgit)
(Reporting by Mei Mei Chu; Editing by Ramakrishnan M and Krishna Chandra Eluri)
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