Palm rises as labour shortage seen hitting output

January 13, 2022: Malaysian palm oil futures climbed on Thursday, rising for the fourth session in five as labour shortage stoked fears of lower output in the world's second largest producer.

The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange gained 56 ringgit, or 1.11%, to 5,096 ringgit ($1,220.60) a tonne in early trade. It had gained 1.07% overnight.


* Sime Darby Plantation Bhd warned that labour shortages at palm oil plantations in Malaysia due to coronavirus border closures will worsen in early 2022 compared to the last six months until workers are allowed to return.

* The world's biggest palm oil planter by land size said there was a shortage of more than 75,000 workers, resulting in a potential 20%-30% hit to production.

* Dalian's most-active soyoil contract gained 0.13%, while its palm oil contract rose 0.22%. Soyoil prices on the Chicago Board of Trade were down 0.76%.

* 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 test a support at 5,002 ringgit per tonne, a break below which could open the way to 4,927 ringgit, Reuters technical analyst Wang Tao said.


* World stocks rose on Wednesday while U.S. Treasury yields and the dollar fell after the latest U.S. inflation data showed price pressures surging but within expectations, apparently suggesting the Federal Reserve will not have to hike interest rates too aggressively.

* Oil prices slipped on Thursday, trimming big gains from the previous two sessions, amid uncertainty over near-term demand as cases of the highly contagious Omicron variant of the coronavirus surge around the globe.

Posted on: 2022-01-13T09:31:35+05:00