Industry regulator, the Malaysian Palm Oil Board (MPOB), will on Wednesday report stock levels for March, with a Reuters poll predicting a drop to 2.35 million tonnes from 2.44 million in February.
“The rise in Dalian palm and soy and also the overnight gain in US soy are helping the rally, while traders are also positioning ahead of MPOB data,” said Ker Chung Yang, investment analyst with Phillip Futures in Singapore.
“But the rise may be capped due to the bird flu situation in China.” Traders are keeping a close watch on the development of a new strain of bird flu in China, fearing that it could cut demand for soy used in animal feed in the world’s top importer of the bean, although the World Health Organization said it was no cause for panic.
The benchmark June contract on the Bursa Malaysia Derivatives Exchange closed 0.2 percent lower at 2,395 ringgit ($789) per tonne. Prices earlier touched a high of 2,419 ringgit, a level last seen on March 28.
Total traded volumes stood at 29,311 lots of 25 tonnes each, compared to the average 35,000 lots seen so far this year.
Technicals showed palm oil is expected to rise to 2,440 ringgit, as indicated by a high-low bottom and a Fibonacci retracement analysis, said Reuters market analyst Wang Tao. In vegetable oil markets, US soyaoil for May delivery inched up 0.1 percent in late Asian trade. The most active September soybean oil contract on the Dalian Commodities Exchange closed 0.5 percent higher.