Palm gains on support from related edible oils

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KUALA LUMPUR (Aug 6): Malaysian palm oil futures rose nearly 1% in early trade on Monday, tracking strength in related edible oils and in line for a second straight session of gains.

The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 0.8% at RM2,214 (US$543.31) a tonne at noon. The market earlier rose as much as 0.9% to RM2,215.

Trading volumes stood at 8,556 lots of 25 tonnes each at the midday break.

"The market is seeing support from overnight US soyoil as well as on strength in Dalian," said a Kuala Lumpur-based futures trader.

Gains in the ringgit around noon on Monday could cap further increases in palm, another trader added.

The ringgit, palm's currency of trade, strengthened 0.1% to 4.0750 against the dollar at the midday break after four previous days of losses.

A stronger ringgit usually makes the tropical oil more expensive for holders of foreign currencies.

In other related oils, the Chicago December soybean oil contract rose 0.9% in Friday's session, and was last up 0.3% on Monday.

Meanwhile, the September soybean oil contract on China's Dalian Commodity Exchange rose 0.8% and the Dalian September palm oil contract was up 0.5%.

Palm oil prices are influenced by the performance of other edible oils as they compete for a share in the global vegetable oils market.

Palm, soy and crude oil prices at 0530 GMT

Contract          Month    Last  Change     Low    High  Volume
MY PALM OIL       AUG8        0   +0.00 0 0 0
MY PALM OIL       SEP8     2193  +15.00    2183    2193     296
MY PALM OIL       OCT8     2214  +18.00    2202    2215    4955
CHINA PALM OLEIN  JAN9     4900  +16.00    4856    4918  174448
CHINA SOYOIL      JAN9     5852  +48.00    5792    5876  309460
CBOT SOY OIL      DEC8    28.94   +0.00   28.78   28.94    1700
INDIA PALM OIL    AUG8   590.40   -1.30  589.50   592.2     213
INDIA SOYOIL      AUG8      737   -2.35  736.05   738.6    1260
NYMEX CRUDE       SEP8    68.71   +0.22   68.50   68.90   22423

CBOT soy oil in US cents per pound
Dalian soy oil and RBD palm olein in Chinese yuan per tonne
India soy oil in Indian rupee per 10 kg
Crude in US dollars per barrel

(US$1 = RM4.0750)
(US$1 = 68.6025 Indian rupees)
(US$1 = 6.8275 Chinese yuan)