Palm futures steady as strong ringgit offsets boost from rival oils
JAKARTA: Malaysian palm oil futures traded sideways on Thursday, after two previous sessions of gain, as higher rival vegetable oils lent support while a strong currency limited gains.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange gained RM8, or 0.2 per cent, to RM4,045 (US$922.04)a metric ton by 0242 GMT.
The contract traded between RM4,012 and RM4,054 a ton in early trade, after closing at RM4,037 in the previous session.
FUNDAMENTALS
Dalian's most-active soyoil contract was up 0.74 per cent, while its palm oil contract gained 0.88 per cent. Soyoil prices on the Chicago Board of Trade (CBOT) rose 0.39 per cent.
Palm oil tracks price movements of rival edible oils as it competes for a share of the global vegetable oils market.
India has started raising palm oil purchases after a lull of five months as a correction in prices has made the tropical oil cheaper than rival soyoil, encouraging refiners to place orders to replenish inventories, four dealers told Reuters.
Oil prices ticked up early on Thursday after falling nearly 2 per cent in the previous session, with investors weighing a potential OPEC+ output increase against conflicting tariff signals from the White House and ongoing US-Iran nuclear talks.
Malaysian ringgit, the contract currency of trade strengthened 0.02 per cent against the US dollar. A stronger ringgit made the contract less attractive for foreign currency holders.
Palm oil FCPOc3 may retrace into a range of RM3,929 to RM3,968 per metric ton, following its failure to break resistance at RM4,072, according to Reuters technical analyst Wang Tao.
Stocks drifted on Thursday and a rebound in the dollar lost traction as investors tried to sift through the noise from the Trump administration and its fickle stance on tariffs and the Federal Reserve's leadership.
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