KUALA LUMPUR: Malaysian palm oil futures rebounded on Monday, following a recovery in rival Dalian oils and weakness in the ringgit.
The Bursa Malaysia Derivatives Exchange's benchmark contract rose 0.23 per cent to RM4,827 (US$1,082.77) a metric ton by the midday break. The contract fell more than 4 per cent last week.
Crude palm oil futures opened lower but quickly recovered on bargain buying following the steadiness seen in competing oils, especially soy oil and rapeseed oil, said Anilkumar Bagani, commodity research head at Mumbai-based Sunvin group.
"The weaker Malaysian ringgit and a strong recovery in rapeseed oil futures in Asian hours further helped the bullish sentiments in palm oil today," he said.
A Kuala Lumpur-based trader also said that the weakness in ringgit was lending support to palm prices.
The ringgit, palm's currency of trade, weakened 0.25 per cent against the dollar, making the commodity cheaper for buyers holding foreign currencies.
The Dalian Commodity Exchange's most-active soyoil contract gained 0.13 per cent, while its palm oil contract added 0.97 per cent. Soyoil prices on the Chicago Board of Trade fell 0.35 per cent. The rapeseed oil futures contract at the Zhengzhou Commodity Exchange rose 1.75 per cent.
Palm oil tracks price movements of rival edible oils, as they compete for a share of the global vegetable oils market.
Oil futures eased from their highest levels in weeks as traders took profit but the falls were limited due to concerns of supply disruptions in the event of more U.S. sanctions on major suppliers Russia and Iran.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Cargo surveyor Intertek Testing Services said exports of Malaysian palm oil products for Dec. 1-15 fell 9.8 per cent from a month earlier to 671,454 metric tonnes while AmSpec Agri Malaysia is expected to release its estimates later in the day. Palm oil may consolidate in the range of RM4,756 to RM4,902 per tonne for one or two days before breaking RM4,756 and falling towards RM4,626, Reuters technical analyst Wang Tao said.