Palm rises over 1% on bargain buying but still heads for weekly loss

Malaysian palm oil futures climbed more than 1% on Friday, driven by bargain buying and gains in Dalian palm olein and Chicago soyoil, but they remain on track for their first weekly loss in four weeks. The January delivery benchmark for palm oil on the Bursa Malaysia Derivatives Exchange jumped 53 ringgit, or 1.15%, to 4,669 ringgit ($1,150.85) per metric ton by midday.

The contract has slipped 3.9% this week. Crude palm oil futures also rose after a bullish recovery in Dalian palm olein and Chicago soyoil during Asian trading hours, according to Anilkumar Bagani, research head at Sunvin Group, a Mumbai-based vegetable oil broker. Bagani noted that prices recovered on bargain buying with solid technical support observed below 4,600 ringgit for the benchmark January 2027 futures.

Currently, market attention is turning to Malaysia's October full-month palm oil export and production data, as well as anticipated increases in inventories. Dalian's most-active soyoil contract climbed 0.61%, while its palm oil contract gained 0.89%. Soyoil prices on the Chicago Board of Trade increased 0.88%. Palm oil mirrors the price movements of other edible oils, competing for market share.

Palm oil prices surged on Friday, setting the stage for a fourth consecutive monthly gain, as an assault on a tanker in the Strait of Hormuz underscored ongoing supply risks stemming from the US-Israeli conflict with Iran, now in its eighth month. Higher crude oil prices make palm a more appealing choice for biodiesel feedstock.

Additionally, the ringgit, palm's trading currency, strengthened by 0.2% against the dollar, making the commodity pricier for buyers using foreign currencies.