Malaysian palm oil futures reversed early losses to close higher on Tuesday, supported by bargain buying and as the Dalian market pared losses slightly.

The benchmark palm oil contract FCPO1! for February delivery on the Bursa Malaysia Derivatives Exchange was up 11 ringgit, or 0.27%, at 4,104 ringgit ($997.81) a metric ton at the close.

The contract fell 0.8% earlier in the session.

“There was bargain buying and this will continue for one to two weeks ahead,” a Kuala Lumpur-based trader said.

Dalian’s most active soyoil contract (DBYcv1) declined 0.85%, while its palm oil contract CPO1! pared losses to 1.12%. Soyoil prices on the Chicago Board of Trade ZL1! rose 0.21%.

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

The Malaysian ringgit, palm’s currency of trade, weakened 0.07% against the U.S. dollar, making the commodity cheaper for foreign currency holders.

Meanwhile, Indonesia plans to require natural resource exporters to retain all foreign currency earnings in state-owned banks for at least a year and limit their use starting from January 1, finance ministry officials said on Monday.
Source: Reuters