A rapidly spreading coronavirus epidemic around the world, however, has limited the gains from tropical oil.
The benchmark contract for palm oil for delivery in March on the Bursa Malaysia Derivatives Exchange rose 49 ringgit, or 2.11%, to 2,367 ringgit ($ 564.51) at 0253 GMT.
Palm oil prices fell 11.5% last week, the largest decline since October 2008, under pressure from massive sales of stocks, commodities and global bonds, as the there is concern that the coronavirus epidemic may turn into a pandemic.
FUNDAMENTALS
Ramadan demand is picking up as prices drop to around 2,300 ringgits and exports are expected to improve in March, said Marcello Cultrera, director of institutional sales at Phillip Futures in Kuala Lumpur.
Ramadan is the holy month of Islam when Muslims around the world fast and pray. It should start on April 23 of this year.
Malaysia and India will work to improve relations that deteriorated under former Malaysian Prime Minister Mahathir Mohamad and have severely affected the trade in palm oil between countries, officials from both countries said.
Malaysian palm oil exports in February fell between 12.2% and 12.9% from the previous month, cargo investigators said on Saturday.
Dalian’s most active soybean oil contract traded 0.67%, while its palm oil contract fell 0.63%. Soybean prices on the Chicago Board of Trade rose 1.5%.
Palm oil is affected by fluctuations in the prices of related oils, which compete for a share of the world market for vegetable oils.
Palm oil could drop further, to 2,236 ringgits per tonne, as it broke support at 2,320 ringgits, said Wang Tao, technical analyst at Reuters.
MARKET NEWS
The rout of global stocks has worsened as investors were shaken by weekend data from China which showed its fastest contraction in industrial activity, raising fears of a global recession due to the coronavirus.
