Palm oil climbs on bargain buying, improved export hopes
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 71 ringgit, or 1.7%, at 4,258 ringgit ($1,007.81) a metric ton at the midday break. The contract fell 1.37% in the previous session.
Bargain buying supported prices across the board while Dalian palm olein recovered from yesterday's lows, a Kuala Lumpur-based trader said.
'The market will also be looking for improvement in export figures in the first half of August,' the trader added.
Dalian's most-active soyoil contract rose 0.92%, while its palm oil contract added 1.72%. Soyoil prices on the Chicago Board of Trade were down 0.09%.
Palm oil tracks price movements of rival edible oils, as it competes for a share of the global vegetable oils market.
India's palm oil imports fell in July on contract cancellations, while soyoil shipments to the country surged to a three-year high due to competitive prices and the delivery of delayed shipments from June, five dealers said.
Malaysia's palm oil inventories are forecast to rise for a fifth consecutive month in July to reach their highest level in almost two years, as production growth outpaced exports, a Reuters survey showed.
Oil prices were flat after declining for three days, as mounting oversupply concerns weighed on the market following OPEC+'s agreement to a large output increase in September. However, the potential for further Russian supply disruptions supported the market.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm's currency of trade, strengthened 0.24% against the dollar, making the commodity slightly more expensive for buyers holding foreign currencies.
Palm oil may bounce to 4,273 ringgit per metric ton as it has broken resistance at 4,211 ringgit, Reuters technical analyst Wang Tao said.
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