KUALA LUMPUR: Malaysian palm oil futures settled higher on Friday, reversing midday losses to loga fourth consecutive weekly gain, despite concerns over rising production and inventories.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange gained 14 ringgit, or0.36%, to 3,917 ringgit ($926.88) a metric ton at the close.
The contract rose 1.01% this week.
Crude palm oil futures had traded lower as concerns over rising output and stock levels in the country continued to weigh on sentiment, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd.
“We see support at 3,800 ringgit and resistance at 4,000 ringgit.”
Dalian’s most-active soyoil contract rose 0.91%, while its palm oil contract gained 0.05%. Soyoil priceson the Chicago Board of Trade (CBOT) were up 1.11%.
Palm oil rebounds on anticipation of strong demand
Palm oil tracks the price movements of rival edible oils as it competes for a share of the global vegetable oils market.
Oil prices slipped but were on track for their first weekly gain in three weeks after U.S. President Donald Trump and Chinese leader Xi Jinping resumed trade talks, raising hopes for growth and stronger demand in the world’s two largest economies.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
The ringgit, palm’s currency of trade, strengthened 0.02% against the dollar, making the commodity slightly more expensive for buyers holding foreign currencies.
American Dollar Exchange Rate