SINGAPORE: Malaysian palm oil futures rose on Friday on bargain-hunting after three straight sessions of losses, with traders expecting seasonally lower production and firm exports to help stocks ease further.
Palm oil posted a loss of 1.3 per cent for the week, weighed down by a weak soy market suffering from poor export demand and higher South American supply.
But market participants said they were still counting on a seasonal decline in output to help ease stocks and support prices, especially after cargo surveyor data on Friday showed firm export demand.
"We see some retracement in an oversold market," said a trader with a foreign commodities brokerage in Kuala Lumpur.
"For the past few days external markets like Dalian and CBOT (Chicago Board of Trade) soybean oil were a little weak, but they have pulled back up a bit, so our market is adjusting to it."
The benchmark May contract on the Bursa Malaysia Derivatives Exchange had gained 2.2 per cent to RM2,415 per tonne by the market close. Prices fell to RM2,360 on Thursday, the lowest level since January 14.
Total traded volume stood at 35,268 lots of 25 tonnes each, higher than the usual 25,000 lots.
Technical analysis suggests palm oil is expected to rebound to RM2,426 per tonne, said Reuters market analyst Wang Tao.
Exports of Malaysian palm oil products from March 1 to 15 inched up 0.2 per cent to 675,210 tonnes from 673,555 tonnes shipped during February 1 to 15, cargo surveyor Intertek Testing Services said on Friday.
Malaysia, the world’s No.2 palm oil producer, will set its crude palm oil export tax for April at 4.5 per cent, unchanged from March, a government circular showed on Friday.-- Bloomberg