Mumbai, May 06, (CommoditiesControl): Malaysian palm oil futures rose on Monday, mirroring the positive momentum observed in competing markets such as soy oil and crude oil.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange witnessed a 0.08% increase or by 3 ringgit to reach 3,847 ringgit per metric ton as of 0238 GMT. Despite experiencing a 1.33% decline last week due to export apprehensions in Malaysia, palm oil showcased resilience in the current trading session.
Key market fundamentals indicate notable movements in related oils. Dalian's most-active soy oil contract rose by 0.81%, while its palm oil counterpart observed a 0.05% dip. Additionally, soy oil prices on the Chicago Board of Trade climbed by 0.65%.
The outlook for the soybean harvest in Rio Grande do Sul has deteriorated swiftly following torrential rain-induced flooding in fields, further impacting market dynamics.
Although a weaker ringgit against the dollar supports the market, Malaysia's palm oil exports from May 1 to 5 is seen to be sharply down, adding weight to palm prices.
Furthermore, the rise in crude oil prices, attributed to Saudi Arabia's decision to increase June crude prices for most regions, coupled with uncertainties surrounding the Israel-Hamas conflict, has bolstered palm oil's appeal as a biodiesel feedstock. Moreover, the slight depreciation of the Malaysian ringgit against the dollar further enhances palm oil's attractiveness for foreign currency holders.
In broader market news, Asian stocks observed gains on Monday amid renewed speculations regarding potential rate cuts by the U.S. Federal Reserve. Conversely, the yen weakened following last week's surge, which was speculated to be a result of Tokyo's suspected currency intervention.
For short-term trades, traders may consider buying at the current market price (CMP) with a target at 3925 and a stop loss at 3800. The short-term trend appears positive, with prices finding support at 3830 levels.
Global Futures of Palm Oil and Soy oil
(By Commoditiescontrol Bureau; +91-9820130172)
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