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By Mei Mei Chu
KUALA LUMPUR, Sept 9 (Reuters) – Malaysian palm oil futures closed higher on Friday after tumbling to a 14-month closing low in the previous session, although the contract logged a second straight weekly drop.
The benchmark palm oil contract FCPOc3 for November delivery on the Bursa Malaysia Derivatives Exchange gained 54 ringgit, or 1.52%, to 3,595 ringgit ($799.60) a tonne.
Palm rebounded on bargain-buying after a heavy sell-off in the last few days, propelled by gains in competing vegetable oils, led by Chicago soy oil, said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Palm has fallen 8.2% this week, as investors are worried that COVID-19-related restrictions in some parts of key buyer China would hit demand amid rising supply.
The Chinese city of Chengdu extended a lockdown for a majority of its more than 21 million residents on Thursday to prevent further transmission of COVID-19 while millions more in other parts of China were told to shun travel in upcoming holidays.
Traders are awaiting the Malaysian Palm Oil Board to release August supply and demand data on Monday. They have factored in polls indicating inventories expanding above 2 million tonnes for the first time in two years. PALM/POLL
Dalian’s most-active soyoil contract DBYcv1fell 0.5%, while its palm oil contract DCPcv1dropped 1%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 1.1%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
($1 = 4.4960 ringgit)
(Reporting by Mei Mei Chu; Editing by Subhranshu Sahu, Uttaresh.V and Maju Samuel)
((Meifong.chu@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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