Business Recorder
KUALA LUMPUR: Malaysian palm oil futures hit a 15-month high on Monday, driven by expectations that Indonesia would go ahead with its palm oil-based biodiesel programme, with rising crude oil prices adding further support. The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange was up 141 ringgit, or 3.04%, at 4,772 ringgit ($1,185.30) a metric ton at closing, the highest since December 13, 2024. Crude palm oil rallied above 4,700 ringgit on news that Indonesia will soon proceed with the B50 biodiesel programme amid rising crude oil prices, said David Ng, a proprietary trader at Kuala Lumpur-based trading firm Iceberg X Sdn Bhd. During an official visit to Japan, Indonesian President Prabowo Subianto said his country will go ahead with its B50 biodiesel programme this year. “We see prices supported above 4,700 ringgit and facing fresh resistance at 4,850 ringgit,” the trader added. In rival markets, Dalian’s most-active soyoil contract rose 0.67%, while its palm oil contract added 2.84%. Soyoil prices on the Chicago Board of Trade gained 1.96%. Palm oil tracks the price movements of rival edible oils as it competes for a share of the global vegetable oils market. Oil prices extended gains on Monday, with Brent heading for a record monthly rise, after Yemeni Houthis launched their first attacks on Israel, widening the U.S.-Israel war against Iran. Stronger crude oil futures make palm a more attractive option for biodiesel feedstock. The ringgit, palm’s currency of trade, also weakened 0.35% against the dollar, making the commodity cheaper for buyers holding foreign currencies. Meanwhile, cargo surveyors estimated that exports of Malaysian palm oil products for March 1-25 rose between 38.4% and 50.6% month-on-month. Full-month March export estimates are due on Tuesday. Separately, India’s market regulator extended the suspension of derivatives trading in seven key agricultural commodities, including crude palm oil, to March-end next year to rein in prices.
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