Palm trades at 2-week high on higher demand, stronger soyoil

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KUALA LUMPUR (May 16): Malaysian palm oil futures rose to a two-week high in early trade on Thursday on better demand for the edible oil, set to gain for the fourth straight day as they tracked gains in soyoil on the US Chicago Board of Trade.      

Benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange was last up 1.4% at RM2,073 (US$498.68) a tonne.

The market earlier rose to RM2,075, its strongest level since May 2. Palm is also up 4.5% so far for the week, in line to chart its first week of gains in four.

"The market is supported by the continuation of good exports," said a Kuala Lumpur-based trader, referring to the export data reported by cargo surveyors on Wednesday.  

Malaysian palm oil shipments rose between 4% and 15% during May 1-15 from the corresponding period last month, according to data from three cargo surveyors, Amspec Agri Malaysia, Intertek Testing Services and Societe Generale de Surveillance.

Another trader added that palm prices were supported by continuous gains in competing vegetable oils.   

The Chicago July soybean oil contract had gained 0.9% on Wednesday, after US President Donald Trump eased concerns over the US-China tariff war, and was last up 0.4% on Thursday.

Palm oil prices are affected by movements in soyoil, with which it competes for global market share.

Palm oil may rise to RM2,091 per tonne, as it has cleared a resistance at RM2,034, said Reuters market analyst for commodities and energy technicals Wang Tao.

Meanwhile, the May soyoil contract on the Dalian Commodity Exchange was up 0.6%, and the Dalian May palm oil contract jumped 2.6%.

Palm, soy and crude oil prices at 0433 GMT

Contract          Month    Last   Change     Low   High  Volume
MY PALM OIL       JUN9     2030   +26.00    2015   2034     340
MY PALM OIL       JUL9     2058   +29.00    2025   2061    4545
MY PALM OIL       AUG9     2073   +28.00    2043   2075    8329
CHINA PALM OLEIN  MAY9     4222  +106.00    4140   4222      24
CHINA SOYOIL      MAY9        0   +34.00 0 0 0
CBOT SOY OIL      JUL9    27.35    +0.11   27.23  27.39    2465
INDIA PALM OIL    MAY9   525.90    +3.50  524.00    526     100
INDIA SOYOIL      MAY9      760    +2.60  758.05  760.5     210
NYMEX CRUDE       JUN9    62.44    +0.42   62.08  62.55   33824

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 = RM4.1570)
(US$1 = 70.2850 Indian rupees)
(US$1 = 6.8763 Chinese yuan)