Palm hits over 1-week top on US soyoil strength, weak ringgit

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KUALA LUMPUR (Feb 19): Malaysian palm oil futures rose by more than 1% on Tuesday to their highest level in over one week, tracking strength in US soyoil prices and on a weaker ringgit.

The ringgit, palm's currency of trade, weakened as much as 0.2%, making the vegetable oil cheaper for holders of foreign currencies. The currency was last down 0.1% at 4.0850 per dollar.   

The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange was up 0.6% at RM2,299 (US$562.79) a tonne at the midday break.

Earlier in the session, it climbed as much as 1.1% to RM2,311, its highest since Feb 8.

Trading volumes stood at 12,586 lots of 25 tonnes each at noon.

"The palm market is up on supportive external markets, along with the weaker ringgit," said a Kuala Lumpur-based trader, referring to soyoil prices on the US Chicago Board of Trade.

The market was also up on expectation of supportive cargo surveyor export data for Feb 1-20, said the trader.

Exports from Malaysia during Feb 1-15 rose between 4.2-12.9% from a month earlier, according to cargo surveyors.

Cargo surveyors are scheduled to release export data for the Feb 1-20 period on Wednesday.

In other related oils, the Chicago March soybean oil contract was up 0.8% on Tuesday, in line with gains in soybeans on optimism about a trade deal between the United States and China.

The May soyoil contract on the Dalian Commodity Exchange rose 0.8%, while the Dalian May palm oil contract added 1.1%.

Palm oil prices are affected by movements in soyoil, as they compete for a share in the global vegetable oil market.     

Palm oil may rise to RM2,316 per tonne, as it has broken a resistance at RM2,285, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

Palm, soy and crude oil prices at 0511 GMT

Contract          Month    Last  Change     Low   High   Volume
MY PALM OIL       MAR9     2207   +1.00    2207   2223      403
MY PALM OIL       APR9     2273   +9.00    2273   2288     3121
MY PALM OIL       MAY9     2299  +13.00    2298   2311     5152
CHINA PALM OLEIN  MAY9     4830  +50.00    4772   4852   354104
CHINA SOYOIL      MAY9     5762  +48.00    5728   5786   253446
CBOT SOY OIL      MAR9     30.2   +0.25   29.96  30.22     2974
INDIA PALM OIL    FEB9   571.50   +4.10  568.00  574.1      238
INDIA SOYOIL      FEB9   782.95   +0.15   782.8  783.5      660
NYMEX CRUDE       MAR9    55.81   +0.22   55.59  56.33    50259

Palm oil prices in Malaysian ringgit per tonne
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 = RM4.0850)
(US$1 = 71.3410 Indian rupees)
(US$1 = 6.7736 Chinese yuan)