- Palm Oil Prices Reach Near 10-Year High as it Tracks Soyoil Gains
- Malaysian palm oil futures experienced a decline on Friday, putting a halt to three consecutive days of gains.
- This came after an industry analyst predicted an increase in supply, coupled with India’s closure of a port on weekends to combat the spread of COVID-19.
- The benchmark palm oil contract for July delivery lost 1.5% to close at 3,929 ringgit ($956.66) per tonne. The market reacted to an advisory that the Kandla Liquid Tank Terminal Association would suspend tanker loading and unloading over the weekend, with traders taking profit ahead of the weekend. Despite this decline, the contract rose 5.7% for the week.
- On Monday, Malaysian palm oil futures rose, supported by an increase in rival soy oil due to concerns over supply disruptions in Argentina and dry weather conditions in South America.
- The benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange increased by 3.44% to close at 3,724 ringgit ($930.07) per tonne, marking its fourth consecutive day of gains and reaching its highest level since February 2011.
- The demand for palm oil remained high in 2020 despite unfavorable weather conditions and infrastructure issues that resulted in tightening supplies. The potential for floods in Indonesia and Malaysia could also affect palm oil supplies, according to a Kuala Lumpur-based trader.
- Prices of related oils such as Dalian’s soy oil contract and palm oil contract, as well as soy oil prices on the Chicago Board of Trade, also increased.