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By Fransiska Nangoy
JAKARTA, Dec 14 (Reuters) – Malaysian palm oil futures extended gains to a second session on Wednesday, as lower-than-expected stocks and strength in related oils helped lift prices.
The benchmark palm oil contract FCPOc3 for February delivery on the Bursa Malaysia Derivatives Exchange gained 1.54% to 3,946 ringgit ($894.78) per tonne by midday break, after gaining 4% on Tuesday.
Palm rose as a “continuation of bargain buying from yesterday reinforced by bullish MPOB data,” said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Malaysia’s palm oil stocks at the end of November fell for the first time in six months, as production slumped amid a slight pick-up in exports, data from the Malaysia Palm Oil Board (MPOB) showed on Tuesday.
The stock fell 4.98% from October, deeper than the 0.47% decline expected in a Reuters poll.
Also helping palm oil up were the higher related oils.
Dalian’s most active soyoil contract DBYv1 were traded 1.20% higher, while its palm oil contract DCPv1 climbed 1.52%. Soyoil prices on the Chicago Board of Trade BOc2 fell 0.78% after posting a 3.09% gain overnight.
Palm oil is affected by price movements in related oils, as they compete for a share in the global vegetable oils market.
Exports of Malaysian palm oil products for Dec. 1-10 rose 15.7% to 473,086 tonnes compared to shipments in Nov. 1-10, cargo surveyor Societe Generale de Surveillance said on Tuesday.
Palm oil may test a resistance at 4,029 ringgit a tonne, a break above which could lead to a gain to 4,132 ringgit, Reuters technical analyst Wang Tao said. TECH/C
Meanwhile, crude palm oil output by rival Indonesia is seen at 48.1 million tonnes in 2023, up from an estimated 46.5 million tonnes this year, according to an industry group forecast.
($1 = 4.4100 ringgit)
(Reporting by Fransiska Nangoy; editing by Uttaresh.V and Rashmi Aich)
((Fransiska.Nangoy@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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