Malaysian palm oil futures closed higher on Tuesday, snapping two sessions of losses, as bargain buyers emerged and short-covering activity provided additional support.

The benchmark palm oil contract FCPO1! for October delivery on the Bursa Malaysia Derivatives Exchange rose 12 ringgit, or 0.28%, to 4,254 ringgit ($1,005.44) a metric ton at the close.

Bargain buyers lifted crude palm oil futures prices to positive territory at the session’s close, a Kuala Lumpur-based trader said.

“It could be that some short coverings are pushing up the market,” the trader added.

Dalian’s most-active soyoil contract (DBYcv1) rose 1.38%, while its palm oil contract CPO1! rose 0.61%. Soyoil prices on the Chicago Board of Trade ZL1! were down 0.11%.

Palm oil tracks the price movements of rival edible oils, as it competes for a share of the global vegetable oils market.

Oil prices edged up on optimism that a trade war between the United States and its major trading partners was abating and as President Donald Trump ramped up pressure on Russia over its war in Ukraine.

Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.

The ringgit USDMYR, palm’s currency of trade, weakened 0.07% against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.
Source: Reuters