KUALA LUMPUR: Malaysian palm oil futures Rises more than 1% on Monday, as top producer Indonesia raised its export tax reference price, but expectations of higher supply capped gains.
The benchmark palm oil contract for November delivery on the BMD Exchange rose 52 ringgit, or 1.25%, to 4,224 ringgit ($941.60) a tonne by the midday break.
Indonesia will raise its crude palm oil reference price for September 1-15 period, effectively increasing .
its export tax to $124 per tonne from the current $74 per tonne. senior economic ministry official Musdhalifah Machmud told Reuters.
The world’s biggest exporter also raised its 2022 biodiesel allocation to 11.03 million kilolitres
amid expectations of rising demand in the fourth quarter while it extends an export levy waiver to maintain price stability.
The higher reference price and export tax added to buying momentum,
the further strength not seen as the market is expecting higher end stocks
And improving production in both Malaysia and Indonesia, a Kuala Lumpur-based trader said.
Malaysian Palm Oil Futures Up
In related oils, Dalian’s most-active soyoil contract unchanged, while its palm oil contract fell 0.4%. Soyoil prices on the Chicago Board of Trade were down 1%.
Palm is set for a short trading week, as the Malaysia bourse will be closed on Wednesday for a public holiday.
Palm oil may test a support at 4,085 ringgit per tonne,
a break below may open the way towards 3,857 ringgit, Reuters technical analyst Wang Tao said.
Malaysian: Palm oil futures bottomed around MYR 4,051 per tonne, as signs of weak domestic export demand prompted investors to unwound some long positions
following a massive rally that drove prices to an over one-month peak of MYR 4,500.
Exports of Malaysian palm oil products for August 1 – 15 fell almost 2% to 490,375 tonnes .
from the same period in July, independent inspection company AmSpec Agri Malaysia said.