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Malaysian palm oil price rebounds from one-week low on weaker ringgit
KUALA LUMPUR: Malaysian palm oil futures rebounded from a one-week low to end the trading day slightly higher, supported by a weaker ringgit which makes the tropical oil cheaper for holders of foreign currencies.
The ringgit, in which palm oil is traded, hovered at 3-week lows during Thursday’s trading session, closing at its intraday low of 4.2855 against the U.S. dollar.
The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange rose 0.2 percent to 2,447 ringgit ($571.00) a tonne at the close of trade, snapping two earlier sessions of declines.
Earlier in the session, it dropped to 2,426 ringgit, its weakest since June 14, pressured by forecasts of rising production and slowing export demand.
Traded volumes stood at 28,312 lots of 25 tonnes.
“The market rose as the ringgit got weaker during the afternoon session,” a futures trader from Kuala Lumpur said. Another trader said that palm was also seeing a technical rebound after breaking the 2,430 ringgit level.
Palm’s early losses reflected bearish sentiment about rising output and slowing demand, as traders expect export figures from cargo surveyors to decline further following the Eid-al-Fitr festivities next week.
Eid marks the end of Ramadan, the Muslim holy month of fasting, which takes place in June this year.
Shipments for the June 1-20 period fell 14-16 percent versus the corresponding period last month, according to data from two cargo surveyors on Tuesday.
In other related oils, soybean oil on the Chicago Board of Trade was down 0.1 percent, while the September soybean oil on the Dalian Commodity Exchange fell 0.4 percent.
The September palm olein contract fell up to 0.6 percent. – Reuters
Source: http://www.thestar.com.my/business/business-news/2017/06/23/palm-oil-rebounds-from-one-week-low-on-weaker-ringgit/#VkxaRmVe6m1z4vKd.99