Palm jumps about 3% to hit three-month high on stronger crude

January 19, 2022: Malaysian palm oil futures jumped on Wednesday to a three-month high, as crude futures rallied to multi-year peaks and top producer Indonesia mulled “limited” palm oil export controls.

The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange was up 145 ringgit, or 2.88%, at 5,179 ringgit ($1,236.04) a tonne, as of 0258 GMT. Earlier in the day, it rose as much 3.2% to its highest since Oct. 21.

The market was closed on Tuesday for a public holiday.

FUNDAMENTALS

* Indonesia is considering “limited restrictions” on palm oil exports and is also hiking cooking oil subsidies as part of attempts to contain surging domestic cooking oil prices and control inflation pressures, senior officials said on Tuesday.

* The world's biggest palm oil producer said it will require palm oil exporters to obtain permits for their shipments and ask producers to declare how much palm oil they plan to sell domestically.

* Dalian's most-active soyoil contract rose 1.5%, while its palm oil contract gained 3%. Soyoil prices on the Chicago Board of Trade were up 1.3%.

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

* Oil prices rose to a seven-year high as an outage on a pipeline from Iraq to Turkey increased concerns about an already tight supply outlook, making palm a more attractive option for biodiesel feedstock.

* Palm oil may rise to 5,106 ringgit per tonne, to fill a gap forming between Jan. 14 and Jan. 17, Reuters technical analyst Wang Tao said.

MARKET NEWS

* Wall Street's optimistic start to the New Year continued on Tuesday as prices for some stocks, oil and the dollar advanced, but investors dialled back risk-taking elsewhere as data showed U.S. manufacturing slowed and COVID-19 spread.

Reuters

Posted on: 2022-01-19T09:11:20+05:00

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