Palm extends gain ahead of cargo surveyor data

January 20, 2022: Malaysian palm oil futures rose on Thursday as top producer Indonesia's new export policy raised supply concerns, although gains were limited by expectation that cargo surveyor data would show a sharp drop in exports.

The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange gained 33 ringgit, or 0.64%, to 5,157 ringgit ($1,232.26) a tonne during early trade, rising for a second consecutive session.

It had gained 0.57% overnight.

FUNDAMENTALS

Cargo surveyors are scheduled to release export data for Jan. 1-20 later in the day, with investors expecting a 36% monthly decline.

Indonesia's biggest palm oil association, GAPKI, said on Wednesday the government was currently drafting a plan aimed at limiting shipments of edible oil to tame domestic cooking oil prices, remarks the Trade Ministry swiftly denied.

To control prices, the Trade Ministry said on Tuesday it would require exporters to obtain shipment approval from the ministry for exports of crude palm oil, used cooking oil and refined, bleached and deodorized palm olein.

Dalian's most-active soyoil contract gained 1.4%, while its palm oil contract rose 1%. Soyoil prices on the Chicago Board of Trade were up 0.1%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Palm oil may retest a support at 5,106 ringgit, as it faces a resistance at 5,174 ringgit per tonne, Reuters technical analyst Wang Tao said.

Reuters