By Mei Mei Chu
KUALA LUMPUR, Dec 9 (Reuters) – Malaysian palm oil futures rose on Thursday, clawing back some of the previous session’s losses, tracking rival soyoil and further supported by supply tightness as investors awaited key Malaysian Palm Oil Board data for further direction.
The benchmark palm oil contract FCPOc3 for February delivery on the Bursa Malaysia Derivatives Exchange gained 41 ringgit, or 0.85%, to 4,882 ringgit ($1,160.17) a tonne by the midday break, rising for a third session in four.
The Malaysian Palm Oil Board and cargo surveyors are scheduled to release supply and demand data on Friday.
December exports remain uncertain, but strong supply shortage will be key to push prices towards a hawkish direction, Mohsin Mohammad, director at Selangor-based cooking oil exporter Sarafiah Natural Resources.
“Currently, we see exporter to the Middle East bidding to get shipments even on high prices due to shortage in the destination countries which moved the prices upwards,” Mohsin added.
Top producers Indonesia and Malaysia are likely to experience heavy rains during January-March 2022 due to an intensified La Nina weather condition, Refinitiv Commodities Research said on Wednesday. This may raise flooding risks in plantations and disrupt production during the first quarter of 2022.
Dalian’s most-active soyoil contract DBYcv1 fell 0.6%, while its palm oil contract DCPcv1 lost 0.9%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.2%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Oil prices extended gains on confidence that the Omicron coronavirus variant would not dent global growth. Gains in crude oil prices make palm a more attractive option for biodiesel feedstock.
Palm oil may rise into a range of 4,873-4,948 ringgit per tonne, as it is stabilising around a support at 4,812 ringgit, Reuters technical analyst Wang Tao said. TECH/C
($1 = 4.2080 ringgit)
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(Reporting by Mei Mei Chu; Editing by Subhranshu Sahu)
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