Palm flat as El Niño fears counter rising stock levels; still poised for second weekly gain

Malaysian palm oil futures held near flat levels on Friday, with the October delivery contract on Bursa Malaysia Derivatives Exchange up 3 ringgit, or 0.06%, at 4,727 ringgit ($1,158.01) per metric ton at midday. Business Recorder reported that the contract has gained 1.03% this week, putting it on course for a second consecutive weekly rise. Trading stayed within a narrow band as rising inventories weighed on prices, while worries about El Niño disrupting output and higher energy costs offset part of the decline.

Palm oil stocks in Malaysia reached a five-month high during July, as output stayed above export demand that was rising, according to Malaysian Palm Oil Board data released on Monday. Separately, Indian edible oil purchases from abroad reached a 10-month high in July, with refiners buying more palm and soyoil to rebuild stocks before the festival season, the Solvent Extractors' Association of India said.

Crude prices edged up after Washington raised the prospect of an open-ended naval blockade against Iran, reviving supply worries that followed the previous session's drop. A 0.12% gain by the ringgit against the dollar made the commodity slightly dearer for foreign buyers, while firmer crude kept palm appealing as biodiesel feedstock.