Lang
Kuala Lumpur: Malaysian palm oil futures traded sideways on Tuesday ahead of the Christmas holiday, as profit-taking limited gains.
The benchmark palm oil contract for March delivery on Bursa Malaysia Derivatives rose by RM13, or 0.29%, to close at RM4,555, equivalent to $1,015.83, per metric tonne.
Anilkumar Bagani, head of commodities research at Sunvin Group, said crude palm oil futures traded sideways to slightly lower because of profit-taking ahead of the Christmas holiday.
The contract had risen 2.46% on Monday, breaking a six-session losing streak, supported by higher soybean oil prices on Dalian and bargain buying after the recent decline.
Bagani said Indonesia’s plan to expand its biodiesel mandate from January 1 had largely already been priced in by the market.
Analysts noted last Wednesday that the plan increasingly appeared likely to be implemented gradually, as industry participants sought a transition period.
The most-active soybean oil contract on Dalian rose by 1.06%, while the palm oil contract gained 1.47%.
Soybean oil prices on the Chicago Board of Trade also rose by 0.12%.
Palm oil tracks price movements in rival vegetable oils because it competes for share in the global vegetable oils market.
Crude oil prices rose on Tuesday, reversing losses from the previous session, supported by a relatively positive short-term market outlook despite weaker trading volume ahead of the Christmas holiday.
Stronger crude oil futures increase palm oil’s appeal as an option for biofuel production.
The ringgit, the currency used for palm oil trade, rose by 0.07% against the US dollar.
A stronger ringgit makes palm oil more expensive for buyers holding foreign currencies.