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Update prices, add analyst comments
JAKARTA, Feb 17 (Reuters) – Malaysian palm oil futures hit a more than six-week high on Friday and were set for a second consecutive weekly gain, as stronger rival edible oils on the Dalian exchange and a weaker ringgit supported the market.
The benchmark palm oil contract FCPOc3 for May delivery had risen 1.55% to 4,132 ringgit ($933.36) per tonne by the midday break, adding 5.11% so far in the week. The contract hit its highest since Jan. 4 in early trade, extending gains to a second day.
“Crude palm oil futures opened gap higher for the third straight day following bullish Chicago soy oil futures overnight and Dalian RBD palm olein, soy oil and ZCE rapeseed oil futures in Asian hours today,” said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.
Dalian’s most-active soyoil contract DBYv1 gained 2.38%, while its palm oil contract DCPv1 increased 3.41%. Soyoil prices on the Chicago Board of Trade BOc2 were down 0.14%.
Palm is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Higher Indonesian tax and levy on palm oil exports for Feb. 16-28 also supported the contract, Bagani said.
“The increase in Indonesia palm oil export levy and taxes… along with lower palm oil export availability until Ramadan is keeping sellers rigid to lower prices,” he added.
The Malaysian ringgit, palm’s currency of trade, slid 0.63% in early deals. A weaker ringgit makes palm oil more attractive to foreign currency holders.
Palm oil’s next resistance is at 4,196 ringgit, a break above which could lead to a gain to 4,311 ringgit. The current rise is tentatively classified as a part of a big flat pattern developing from the Dec. 12, 2022 low of 3,721 ringgit, said Reuters technical analyst Wang Tao TECH/C
($1 = 4.4270 ringgit)
(Reporting by Bernadette Christina Munthe; editing by Uttaresh.V and Subhranshu Sahu)
((Bernadette.christina@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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