Malaysian palm oil Prices rose more than 3% on Wednesday to their highest level in nearly seven weeks, as fears of higher import taxes in India and heavy rains hurting production spurred buyers on.
A palm oil Prices for January delivery on the Bursa Malaysia derivatives exchange rose RM129, or 3.22%, to RM4,140 ($877.30) a tonne.
Palm oil rose for the fourth consecutive session, hitting its highest level since September 1st.
“The market was supported this week by a potential increase in India’s import tax, prompting consumers to cover some needs,” Marcello Caltrera, director of Kuala Lumpur-based commodities consultancy Apricus 8 Pte Ltd, told Reuters.
India is considering raising taxes on palm oil imports to help millions of its farmers hurt by declining oilseed prices, government and trade sources said.
Palm oil prices have also been supported by downpours holding back production and disrupting logistics in East Malaysia and Central Kalimanta in Indonesia, Kaltrera said.
Flooding and heavy rain forecasts in parts of Indonesia and Malaysia heightened fears of disruption to harvesting activities and reduced supplies from the world’s largest producers.
Dalian’s most active soybean oil contract was up 0.7%, while palm oil was up 3.7%. Soybean oil prices on the Chicago Mercantile Exchange rose 1.9% overnight.
Palm oil is affected by price fluctuations in related oils as they compete for share in the global vegetable oil market.
Palm Prices is facing resistance at RM4,071/t. It could hover below that level or return to the RM3,924 to RM3,958 support zone, Reuters technical analyst Wang Tao told
