KUALA LUMPUR (Aug 8): Malaysian palm oil futures rose 1% by close of trade on Wednesday, reversing losses from earlier in the day to chart a fourth straight day of gains, on expectations Malaysia's crude palm oil export duty for September could be a zero rate.
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 1% at 2,258 ringgit (US$554.25) a tonne in the evening. The market earlier climbed to 2,265 ringgit, palm's strongest levels since July 10, helped too by a technical rebound.
Trading volumes stood at 70,765 lots of 25 tonnes each at the end of the trading day.
"The market jumped on a technical rebound, plus traders expect that September's export duty could be zero," said a futures trader in Kuala Lumpur, referring to Malaysia's export duty on crude palm oil which was last set at a 4.5% rate in August.
Malaysia, the world's second largest palm oil producer, sets a monthly export duty for crude palm oil, but a zero rate is incurred if palm prices fall below 2,250 ringgit.
Benchmark palm prices have been trading below 2,250 ringgit in the past month. Its average price for the month of July is 2,251 ringgit, according to Eikon data.
In other related oils, the Chicago December soybean oil contract rose 0.3%, while the January soybean oil contract on China's Dalian Commodity Exchange was up 0.5%.
Meanwhile, the Dalian January palm oil contract edged up 0.6%.
Palm oil prices are impacted by movements of other edible oils, as they compete for a share in the global vegetable oils market.
Palm, soy and crude oil prices at 1135 GMT
Contract Month Last Change Low High Volume
MY PALM OIL AUG8 2211 +25.00 2210 2249 105
MY PALM OIL SEP8 2239 +25.00 2200 2250 3654
MY PALM OIL OCT8 2257 +23.00 2219 2265 21857
CHINA PALM OLEIN JAN9 4928 +30.00 4906 4942 256516
CHINA SOYOIL JAN9 5888 +28.00 5854 5910 331110
CBOT SOY OIL DEC8 29.19 +0.00 29 29.21 6309
INDIA PALM OIL AUG8 594.80 +1.20 591.60 595.7 535
INDIA SOYOIL AUG8 736.2 -1.40 735.3 739.5 6760
NYMEX CRUDE SEP8 68.85 -0.32 68.63 69.37 96925
Palm oil prices in Malaysian ringgit per tonne
CBOT soy oil in U.S. 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 U.S. dollars per barrel
(US$1 = 4.0740 ringgit)
(US$1 = 68.6225 Indian rupees)
(US$1 = 6.8344 Chinese yuan)