KUALA LUMPUR: Malaysian palm oil futures took early gains on Wednesday as markets eased a fall in August exports and focused on a tight supply outlook in global edible oils due to warmer weather in soybean producers South America and the US. did.
Benchmark palm oil for delivery in November closed at 4,365 ringgit ($1,038.79) per tonne, up 62 ringgit, or 1.44%, on the Bursa Malaysia Derivatives Exchange. The contract has been extended for three out of four seasons.
Malaysia's exports during August 1-25 fell between 12% and 13% compared to the same period in July, the cargo surveyor said.
The Malaysian Palm Oil Association (MPOA)'s recent production growth forecast for August 1-20 raises high chances of Malaysia's production returning to its normal peak in the third quarter, a Singapore-based trader said.
"Better-than-expected palm oil production and weaker exports are a recipe for a bigger sell-off, but that is not and will not happen in the near future," said Paramalingam Supramaniam, director of Selangor-based brokerage Pelindung Bestari.
Paramalingam said "very tight" supply conditions in top palm oil producer Indonesia and ambiguity with biodiesel mandates in the US drove prices up.
"Thus any downtrend or correction is an opportunity for bargaining," he said.
The US Environmental Protection Agency is expected to recommend the White House reduce the federal biofuels blending mandate for 2021 to below 2020 levels, a blow to the biofuels industry, Reuters reported on Friday. gave information.
Soy oil prices on the Chicago Board of Trade were down 0.2% after rising 3.4% in the previous session. Dalian's most active soy oil contract rose 2.1% and its palm oil contract rose 2.4%.
Palm oil is affected by price fluctuations in related oils as they compete for share in the global vegetable oil market.
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