Palm oil gains over 1% on stronger crude

 May 13, 2022: Malaysian palm oil futures were on course for a weekly rise, gaining on Friday ahead of a long weekend as crude futures firmed and a U.S. report warned of tight soybean supplies.

Stronger crude oil makes palm a more attractive option for biodiesel feedstock, while price moves in rival vegetable oils such as soybean also impact palm. O/R

The benchmark palm oil contract FCPOc3 for July delivery on the Bursa Malaysia Derivatives Exchange gained 97 ringgit, or 1.53%, to 6,439 ringgit ($1,464.57) a tonne during early trade.

For the week, palm oil has gained 0.6% so far.

FUNDAMENTALS

The U.S. Agriculture Department said in a monthly crop report on Thursday that U.S. farmers will harvest a record large soybean crop, but supplies will remain tight due to soaring demand from biofuel and crush sectors. 

Soyoil prices on the Chicago Board of Trade BOcv1 were up 1%. Dalian's most-active soyoil contract DBYcv1 gained 1.3%, while its palm oil contract DCPcv1 rose 1.2%.

Oil prices firmed in early trade but were headed for their first weekly losses in three weeks as worries about inflation and China's COVID lockdowns slowing global growth outweighed concerns about dwindling fuel supply from Russia.

Traders are closely monitoring signs of Indonesia lifting its export ban on crude and refined palm oil as production in the world's biggest export and producer picks up.

The Malaysian bourse will be closed on Monday for public holidays.

MARKET NEWS

Asian shares found some footing after a volatile session for U.S. equities, but the dollar remained at 20-year highs and global stocks near 18-month lows on worries about persistently high inflation and tightening central banks. 

Reuters

Posted on: 2022-05-13T09:20:58+05:00

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