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Palm Oil Market Trading Around 3,750 Ringgit Per Tonne

KAULA LUMPUR:  Malaysian palm oil futures were trading around the MYR 3,750 level, close to levels not seen in almost three weeks, buoyed by an overall weak ringgit and broadening discounts to other soft oils.

Market participants have been taking advantage of palm oil’s growing price advantage to rival soybean oil, which should attract price-conscious buyers and expand biofuel usage.

Keeping a lid on prices was recent data showing that Malaysia’s end-September palm oil inventories widened to the highest level in almost three years, as soaring production offset strong exports.

On top of that, increasing competition from rival Indonesia after Jakarta waived an export levy should limit any significant upside move.

Palm Oil Trader David Ng Comments

Earlier palm oil trader David Ng told  that the market trading expected new week prices to trade in a range between RM3,500 per tonne and RM4,000 per tonne and with a slight downside bias given the weaker demand and high stock situation in the market.

Echoing him, Mumbai-based Sunvin Group commodity research head Anilkumar Bagani said the next week would be short due to holiday on Monday and then there are September supply and demand data released by the Malaysian Palm Oil Board (MPOB) scheduled on Tuesday.

While Singapore-based Palm Oil Analytics’ owner and co-founder Sathia Varqa said markets are expecting the MPOB data to show higher September end-month stocks, nearing three years high

According to cargo surveyor, Intertek Testing Services said Malaysia’s palm oil export during October 1-5 period was down by nearly 38 per cent to 155,170 tonnes.

On a Friday-to-Friday basis, CPO futures contracts for spot month October 2022 rose RM303 to RM3,630 a tonne, November 2022 increased RM406 to RM3,790 a tonne, December 2022 improved RM421 to RM3,837 a tonne and January 2023 added RM416 to RM3,876 a tonne.