Malaysian palm oil futures edged higher on Tuesday, buoyed by gains in Chicago soyoil, while traders awaited key export data from cargo surveyors.
Market Highlights:
- The benchmark February palm oil contract on the Bursa Malaysia Derivatives Exchange increased by 40 ringgit (0.82%) to 4,939 ringgit ($1,104.92) per metric ton during early trade, recovering from a 3.71% drop in the previous session.
- Chicago Board of Trade soyoil prices rose by 0.13%, while Dalian’s soyoil and palm oil contracts declined by 0.36% and 0.46%, respectively.
- Palm oil prices often track movements in other edible oils due to competition for global market share.
Key Influences:
- Export Data: Traders are closely watching estimates for Malaysian palm oil exports for the Nov. 1–20 period, expected to be released on Wednesday.
- Crude Oil Impact: A retreat in crude oil prices following Norway’s Johan Sverdrup oilfield production stall has tempered optimism, with weaker crude futures reducing palm oil’s attractiveness for biodiesel feedstock.
- Currency Strength: The Malaysian ringgit appreciated by 0.2% against the dollar, potentially raising costs for foreign buyers of palm oil.
Market Outlook:
- According to the Malaysian Palm Oil Council, palm oil prices are likely to remain above 4,750 ringgit in November, supported by uncertainties around export supplies and higher soft oil prices.
- Technical analysis by Reuters suggests palm oil may test support at 4,816 ringgit per metric ton and potentially decline to 4,732 ringgit.
