Palm climbs over 3% on Indian demand, duty waiver expectations

Business Recorder reported that Malaysian palm oil futures rose more than 3% on Thursday, reversing two consecutive sessions of declines. The December contract on the Bursa Malaysia Derivatives Exchange climbed 139 ringgit, a 3.07% rise, to close at 4,663 ringgit, or $1,140.66, a metric ton. The gain came as strong purchases from India, the top buyer, outweighed worries about rising inventories.

India bought 150,000 tons of crude palm oil over three days this week for November and December shipment. The purchases followed disruption to sunflower oil cargoes out of the Black Sea, linked to the Russia-Ukraine war. A Mumbai-based dealer with a global trade house warned that Black Sea logistics were deteriorating, which would push India to replace lost sunflower oil with palm oil. Anilkumar Bagani, research head at Sunvin Group, said the anticipated Malaysian inventories for late September were largely reflected in prices, leaving the market awaiting new direction.

Traders also cited talk of a possible move to scrap export levies on raw palm oil at Friday's budget sitting, which would sharpen Malaysia's competitiveness against Indonesia. Dalian's most-active soyoil contract lost 0.31% and its palm oil contract dropped 0.88%, while Chicago soyoil rose 0.74%. Crude oil climbed nearly 4% on Middle East supply concerns and attacks on shipping in the Gulf, while US output fell as a hurricane threatened offshore production. Higher crude makes palm a more appealing biodiesel feedstock, according to the report.