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Palm recovers on strong India demand

September 20, 2022: Malaysian palm oil futures rose on Tuesday after a three-session slide, as traders weighed forecasts of rising production against strong demand from top buyer India ahead of a key festival.

The benchmark palm oil contract FCPOc3 for December delivery on the Bursa Malaysia Derivatives Exchange gained 30 ringgit, or 0.81%, to 3,730 ringgit ($819.78) in early trade.

FUNDAMENTALS

* Indonesian palm oil producers are whittling down their hefty inventory overhang with discounts versus rivals and aggressive sales to India, where demand is picking up for next month's Diwali festival, industry officials said.

* Malaysia's palm production is expected to increase in September, though labour shortages and higher exports may limit the rise, Refinitiv Commodities Research said in a note late on Monday.

* Dalian's most-active soyoil contract DBYcv1 fell 1.8%, while its palm oil contract DCPcv1 plunged 3.2%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.05%.

* 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 break a support of 3,646 ringgit per tonne, and fall into 3,481-3,583 ringgit range, Reuters technical analyst Wang Tao said. TECH/C

MARKET NEWS

* Asian shares edged up in early trade following a rebound in the final hour of New York trading as investors turned their attention to an expected hefty Federal Reserve interest rate hike this week to tackle inflation. MKTS/GLOB

* Oil prices were little changed on concerns that interest rate hikes in the United States to tame inflation will curb economic growth and fuel demand in the world's biggest crude consumer.

Reuters

Posted on:2022-09-20T10:07:54+05:00

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