JAKARTA: Malaysian palm oil futures closed higher on Friday, tracking soaring crude oil prices and rival edible oils in Dalian and Chicago amid geopolitical concerns, and booked a five-week streak of gains.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange gained 88 ringgit, or 2.29%, to 3,927 ringgit ($925.52) a metric ton at the close.
The contract gained 0.26% this week.
“Today’s market is reacting towards Israel’s bombing of Iran, resulting in the rise of crude oil,” a Kuala Lumpur-based trader said.
Oil prices jumped more than 7% on Friday, trading near multi-month highs after Israel launched widescale strikes against Iran, sparking Iranian retaliation and raising worries about disrupted oil supplies.
Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.
India’s palm oil imports in May rise over 84% m/m, trade body says
Dalian’s most-active soyoil contract rose 1.09%, while its palm oil contract gained 1.65%. Soyoil on the Chicago Board of Trade (CBOT) added 1.85%.
Palm oil tracks the price movements of rival edible oils as it competes for a share of the global vegetable oils market.
India’s palm oil imports in May rose about 84% month-on-month to 592,888 metric tons, a trade body said on Thursday.
Malaysian ringgit, the palm’s currency of trade, strengthened 0.62% against the U.S. dollar, making the contract more expensive for holders of foreign currencies.
American Dollar Exchange Rate