(Agriculture.com) – Malaysian palm oil futures made some gains in Monday trade, rising after two consecutive weeks of losses as a weaker ringgit and improving exports supported the market.
The palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange strengthened 1 percent, registering its strongest gains in three weeks to reach 2,668 ringgit ($680) per tonne at the close of trade.
Traded volumes were 50,507 lots of 25 tonnes each, more than a 2015 daily average of 44,600.
“It’s mainly the ringgit propelling the market higher today, said a trader based in Kuala Lumpur. “But exports have also been fairly good.”
The ringgit, the currency palm oil is traded in, fell 0.6 percent against the dollar in trade on Monday evening to reach 3.9250 on tumbling oil prices, as major producers in Qatar failed to come to an agreement to freeze output.
A weaker ringgit typically supports palm oil, as it makes the vegetable oil cheaper for foreign currency holders.
Palm oil shipments from Malaysia showed rising export demand for the first half of April, even with an export tax in place.
Cargo surveyor data showed improving shipments between 7-20 percent from the first half of March, lifted by demand to China and India.
Malaysia had raised its crude palm oil export tax to 5 percent for April and May, ending a duty free policy held since May 2015.
Palm oil has found support at 2,629 ringgit per tonne and may either hover above this level or rise towards resistance at 2,716 ringgit, according to analysis by Wang Tao, Reuters market analyst for commodities and energy technicals.
The September soybean oil contract on the Dalian Commodity Exchange fell 0.3 percent, while the May Chicago Board of Trade soyoil contract rose 0.8 percent.
The offer price for crude palm kernel oil stood at 4877.71.
