Malaysian palm oil futures inched up on Tuesday as a drop in prices to 4-month lows in the previous session attracted some buyers, although gains were limited by slowing export demand. “We see some bargain hunting today, but overall sentiment is still volatile especially on the macroeconomic front. Support remains at 2,250 ringgit,” said a trader with a foreign commodities brokerage in Kuala Lumpur.
The benchmark July contract on the Bursa Malaysia Derivatives Exchange gained 0.8 percent to close at 2,272 ringgit ($743) per tonne. Prices fell to 2,250 ringgit on Monday, a level not seen since December 14. Total traded volumes stood at 35,888 lots of 25 tonnes each, slightly more than the average 35,000 lots seen so far this year.
Technical analysis showed palm oil is expected to consolidate in a range of 2,249 to 2,289 ringgit for one trading session before resuming its downtrend, Reuters market analyst Wang Tao said. Malaysian palm oil exports for April 1-20 fell 6.4 percent to 864,206 tonnes from 922,987 tonnes shipped during March 1-20, cargo surveyor Societe Generale de Surveillance said.
Sluggish exports could prevent end-stocks from easing below the psychological 2-million-tonne mark, putting more pressure on palm oil prices. Inventory level fell to 2.17 million tonnes in March, down 11 percent from February’s 2.44 million tonnes. In other vegetable oil markets, US soyaoil for July delivery edged down 0.6 percent in late Asian trade. The most-active September soybean oil contract on the Dalian Commodities Exchange fell 1 percent.
