Malaysian palm oil price extends rally for 7th day on stronger export data outlook

The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was last up 0.3% at 2, 219 ringgit ($529.97) per tonne at the close of trade, charting a seventh straight day of gains. It earlier rose by 0.5% to 2, 223 ringgit, its strongest levels since April 9.

KUALA LUMPUR: Malaysian palm oil futures extended their rally late on Wednesday, hitting their highest in four and a half months, supported by expectations of stronger export data.

The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was last up 0.3% at 2, 219 ringgit ($529.97) per tonne at the close of trade, charting a seventh straight day of gains.

It earlier rose by 0.5% to 2, 223 ringgit, its strongest levels since April 9.

“I believe the market is up anticipating higher export data, ” said a Kuala Lumpur-based palm oil trader, referring to Malaysian palm oil shipment data for the August 1-15 period, scheduled for release by cargo surveyors on Thursday.

“News on B30 in Indonesia should also be supportive.”

Indonesia’s Energy and Mineral Resources Ministry said on Wednesday that biodiesel with 30% palm diesel blend passed a series of cold temperature tests this week as the government aims to increase the palm content in biodiesel early next year.

Indonesia is the world’s largest palm oil producer, and is ramping up its domestic biodiesel program to increase consumption, reduce stockpiles and prop up prices.

President Joko Widodo said earlier this week he wanted the so-called B30 standard to be adopted in January next year, up from the current B20 standard which contains a 20% blend of palm fatty acid methyl ester (FAME).

In other related oils, U.S. soyoil futures on the Chicago Board of Trade was last up 0.5%, and the September soyoil contract on the Dalian exchange was down 0.7%.

Meanwhile, the Dalian September palm oil contract fell 0.1%. Palm oil prices are affected by movements in related oils that compete in the global vegetable oils market. – Reuters

Source : The Star