Malaysian palm oil futures rise on competitive pricing

Malaysian palm oil futures saw a positive trend on Wednesday, as market participants eagerly awaited data on export and production performance for the first half of the month. The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange experienced a 1.21% increase, reaching 3,861 ringgit per metric ton during the midday break. This rise in price was attributed to the competitiveness of palm oil compared to other oils in the market.

Market sentiment indicates that current palm oil prices are viewed as competitive, with a focus on the upcoming export and production performance data for May 1-15. While Dalian's soyoil contract showed a slight increase, palm oil contract remained stable. Additionally, soyoil prices on the Chicago Board of Trade also observed a rise of 0.67%.

Palm oil prices are influenced by movements in related oils as they compete for market share in the global vegetable oils market. Analysts are anticipating the release of monthly US soy crushing data, expecting a decrease in soybean crushing for April but an increase from the previous year. India's palm oil imports surged in April due to attractive prices, recording a 40.9% increase from the previous month.

Oil prices climbed on Wednesday supported by a weakening US dollar and reports of reduced US crude and gasoline inventories. With stronger crude oil futures, palm oil becomes a more appealing choice for biodiesel feedstock. Technical analysis suggests that palm oil may find stability in the support range of 3,760-3,787 ringgit per metric ton before potentially rebounding.

The rise in Malaysian palm oil futures reflects the competitive pricing of the commodity in the global market. With increasing demand and supportive factors like a weakening US dollar, palm oil continues to be a significant player in the vegetable oils market. Analysts are closely monitoring export and production data to gauge future market trends, while the surge in India's palm oil imports highlights the attractiveness of palm oil prices. Overall, the outlook for palm oil remains positive, with potential for further growth in the coming months.