InfoSAWIT, KUALA LUMPUR – Malaysian palm oil futures rose on Friday following a three-session decline, but the market remains on track for its first weekly loss in four weeks as traders await export data for further direction. 

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange increased by 14 ringgit, or 0.28%, to 4,978 ringgit ($1,112.15) per metric ton during the midday break. Despite the uptick, the contract has dropped 2.41% this week. 

“There’s profit-taking in palm oil ahead of the weekend after three consecutive declines, while investors are waiting for export data for clearer guidance,” said a Kuala Lumpur-based trader, as quoted by InfoSAWIT via Reuters on Sunday (17/11/2024). 

In related markets, the most active soybean oil contract on the Dalian Commodity Exchange fell 0.91%, while its palm oil counterpart rose 0.53%. On the Chicago Board of Trade, soybean oil prices edged up 0.43%. 

Palm oil prices often track movements in competing edible oils as they vie for a share of the global vegetable oil market. 

Meanwhile, soybean and corn futures in Chicago fell for the fourth consecutive session as traders fretted over potential biofuel policy changes under the incoming U.S. administration of Donald Trump, which could lower domestic demand. 

On Thursday, the European Parliament moved to weaken a proposed ban on imports of commodities linked to deforestation, such as beef and soybeans. It also supported a one-year delay for the implementation of the new rules, countering the European Union's aggressive environmental agenda. 

The ringgit, the currency in which palm oil is traded, strengthened by 0.04% against the U.S. dollar, making palm oil more expensive for foreign buyers holding other currencies. 

Oil prices fell on Friday amid signs of sluggish demand in China, the world’s largest crude importer, as its uneven economic recovery continued. Lower crude oil prices make palm oil less appealing as a biodiesel feedstock. 

Reuters technical analyst Wang Tao projected that palm oil prices could retest the November 14 low of 4,826 ringgit per ton, as the correction from the November 8 high of 5,205 ringgit remains incomplete. 

This week’s decline reflects broader uncertainties in global markets, with palm oil caught between volatile edible oil dynamics and geopolitical shifts influencing trade policies. (T2)