Palm Oil Posts Biggest Weekly Gain in Four as Ringgit Weakens

Dec 20, 2013 5:27 am ET

(For physical price assessments, see MPOI1.)

Dec. 20 (Bloomberg) -- Palm oil capped the biggest weekly advance in four as a decline in the Malaysian currency to the lowest level in three months boosted prospects for exports from the world’s second-largest producer.

The contract for delivery in March advanced 0.5 percent to close at 2,587 ringgit ($785) a metric ton on the Bursa Malaysia Derivatives. Futures gained 1 percent this week, the most since the five days ended Nov. 22.

The ringgit posted a ninth straight weekly drop, its longest run of losses in eight years, on speculation inflows will slow as the U.S. Federal Reserve begins curbing stimulus. Shipments from Malaysia fell 12 percent to 883,575 tons in the first 20 days of December from a month earlier, surveyor Intertek said today. That was less than the 20 percent drop in the first 10 days of the month, data showed.

“The only positive factor has been the ringgit,” Benny Lee, a market strategist at Jupiter Securities Sdn., said by phone from Kuala Lumpur. Demand may increase if prices fell to to 2,500 ringgit, he said.

Soybean oil for March delivery was little changed at 39.59 cents a pound on the Chicago Board of Trade. Soybeans were little changed at $13.2025 a bushel.

Refined palm oil for May delivery advanced 0.3 percent to close at 6,046 yuan ($996) a ton on the Dalian Commodity Exchange. Soybean oil ended little changed at 6,960 yuan.

--Editors: Thomas Kutty Abraham, Jake Lloyd-Smith