Palm Oil Prices Surge on Firm Crude and Soyoil Markets

Palm oil futures in Malaysia rose sharply as trading resumed after a holiday, driven by firmer crude oil prices and stronger rival edible oils. The benchmark November palm oil contract increased by 1.82% to 4,983 ringgit a ton in early trading, extending gains for a second session.

The rise was partly attributed to the broader vegetable-oils market, where soyoil and other palm contracts were higher due to their competing demand in the global cooking-oil market. Crude oil prices also firmed up, which can make biodiesel production more attractive and pull some palm oil away from food use and into fuel.

A weaker ringgit added another boost to Malaysia's exports by making them cheaper in US-dollar terms. Traders are closely watching Indonesia's policy and supply signals, while Reuters technical analyst Wang Tao pointed out a near-term trading area around 4,949-4,990 ringgit for the palm oil contract.