Malaysian palm oil futures recovered on Tuesday, as concerns of tighter supply amid a poor monsoon forecast in India pushed prices higher.
The benchmark palm oil contract FCPOc3 for November delivery on the Bursa Malaysia Derivatives Exchange strengthened 44 ringgit, or 1.07%, to 3,953 ringgit ($850.11) per metric ton in early trade.
FUNDAMENTALS
* India is poised for its lowest monsoon rains in eight years, with the El Niño weather pattern seen crimping September precipitation after an August that is on track to be the driest in more than a century, two weather department officials told Reuters on Monday.
* Exports of Malaysian palm oil products during Aug. 1-25 declined between4.3% and7.8%, independent inspection company AmSpec Agri Malaysia and cargo surveyor Intertek Testing Services said on Friday.
* Indonesia’s palm oil exports, including refined products, in June stood at 3.45 million tons, while the stock by the end of June was at 3.69 million tons, data from the Indonesian Palm Oil Association showed.
* Dalian’s most-active soyoil contract DBYcv1 fell 0.2%, while its palm oil contract DCPcv1 climbed 0.1%. Soyoil prices on the Chicago Board of Trade BOcv1 dipped 0.4%.
* Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
* The Malaysian ringgit MYR=, palm’s currency of trade, firmed 0.09% against the dollar, but remained near an over one-month low. A weaker ringgit generally makes palm oil more attractive for foreign currency holders.
* Palm oil FCPOc3 looks neutral in a range of 3,909-3,963 ringgit per metric ton, and an escape could suggest a direction., said Reuters technical analyst Wang Tao.
