Friday 29 Mar 2024
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KUALA LUMPUR (Nov 30): Malaysian palm futures reversed course to gain in late trade on Wednesday as they tracked a rally in crude oil prices, following stronger prospects that oil supplies could be cut.

Saudi Arabia's energy minister said at a meeting of the Organization of the Petroleum Exporting Countries an agreement among members to cut output was close.  

"Crude oil rallied as OPEC nears a deal to cut supplies," said a palm oil trader from Kuala Lumpur, explaining palm's price gains in the evening.

"If crude oil supplies are controlled it should support the (palm oil) market. Higher crude oil prices will be more feasible for the biodiesel mandate."

Palm prices are impacted by crude oil's performance, as the tropical oil is used as component for biodiesel.

Benchmark palm oil futures for February delivery on the Bursa Malaysia Derivatives Exchange rose 0.8% to RM3,073 (US$688) a tonne at the end of the trading day.

Traded volumes stood at 47,834 lots of 25 tonnes each, slightly above the 2015 average of 44,600 lots traded in a day.

Palm oil had previously charted six consecutive days of gains, hitting a four-year high last Thursday, before declining for one session on Tuesday.

Palm oil shipments from Malaysia, the world's No.2 producer of the tropical oil, fell 10–12% for the full month of November from the previous month, according to data from cargo surveyors on Wednesday.  

In related vegetable oils, the January soybean oil contract on the CBOT rose 1.4%, while May soybeans on the Dalian Commodity Exchange dropped 0.1%.

The May contract of palm olein on the Dalian Commodity Exchange was down 1.2%.

Palm, soy and crude oil prices at 1057 GMT

Contract          Month    Last  Change     Low   High   Volume
MY PALM OIL       DEC6     3079  +22.00    3035   3092      310
MY PALM OIL       JAN7     3076  +17.00    3026   3086     1341
MY PALM OIL       FEB7     3073  +23.00    3017   3083    25316
CHINA PALM OLEIN  MAY7     6212  -72.00    6114   6266  1051606
CHINA SOYOIL      MAY7     7154  -10.00    7036   7214  1091496
CBOT SOY OIL      JAN7    37.15   +0.55   36.52  37.26    21528
INDIA PALM OIL    NOV6   554.40   +0.90  553.20  554.7      301
INDIA SOYOIL      DEC6    722.3   +7.40  712.55  723.7    22560
NYMEX CRUDE       JAN7    47.97   +2.74   45.22  48.22   274040

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 = RM4.4640)
(US$1 = 68.4550 Indian rupees)
(US$1 = 6.8807 Chinese yuan)

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