Mumbai, May 07, (CommoditiesControl): In recent trading sessions, Malaysian palm oil futures have demonstrated a noteworthy upward trend, marking a consecutive rise driven by persistent gains in soy oil values. This surge is attributed to unfavourable weather conditions affecting oilseed plantations in Brazil and Russia, alongside parallel concerns over Indonesia's palm oil production due to adverse weather patterns.
The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange exhibited a notable increase of 1.55%, equating to 3,922 ringgit ($827.43) per metric ton by midday break.
The aftermath of April's extensive sell-off of Malaysian palm oil has prompted a recalibration within the market, influenced by prevailing weather dynamics impacting edible oils. Of particular concern are reports of potential soybean shortages amidst climatic disturbances in Brazil and Russia, fuelling an upward trajectory in soyoil prices.
Indonesia's meteorological agency has issued warnings regarding impending extreme weather events spanning May 7-13, including the likelihood of tornadoes, thunderstorms, and subsequent risks of floods and landslides. Notably, approximately 64% of Indonesia is expected to enter a dry season from May to August, a phenomenon known to adversely affect palm yields.
Meanwhile, on international commodity exchanges, Dalian's active soyoil contract observed a rise of 1.74%, complemented by a 2.19% increase in its palm oil counterpart. Similarly, soyoil prices on the Chicago Board of Trade registered a 0.5% uptick following a 1.76% surge on Monday.
The Malaysian ringgit, serving as palm oil's currency of trade, exhibited a marginal weakening of 0.06% against the dollar, reflecting broader market dynamics.
Traders may consider initiating short positions in Malaysian palm oil if prices close below the 21-EMA around 3900 levels on a 15-minute timeframe, targeting 3835 with a stop loss at 3925
Global Futures of Palm Oil and Soyoil
By Commoditiescontrol Bureau; +91-9820130172)
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