Palm oil swung between gains and losses as investors weighed concerns that stockpiles in Malaysia, the second-largest producer, may remain near record levels against expectations of rising demand.
The contract for May delivery ended the morning session little changed at 2,402 ringgit ($774) a metric ton on the Malaysia Derivatives Exchange. Futures climbed as much as 0.5 percent before falling 0.3 percent.
Palm oil will probably advance as the global economy recovers and the government provides incentives for farmers to cut down old trees, Bernard Dompok, Malaysia’s Plantation Industries and Commodities Minister, said in an interview yesterday. That would help cap inventories that reached a record 2.63 million tons in December, he said. Stockpiles in Malaysia probably fell 5.4 percent in February to 2.44 million tons from a month earlier, a Bloomberg survey showed.
“The general trend in the market is bearish,” said Paramalingam Supramaniam, director at Kuala Lumpur-based brokerage Pelindung Bestari Sdn. People are waiting for cues from Dorab Mistry, a director at Godrej International, who’s due to address an industry conference in Kuala Lumpur today, he said.
Soybean oil for May delivery gained 0.3 percent to 50.30 cents a pound on the Chicago Board of Trade. Soybeans for May delivery were little changed at $14.65 a bushel.
Refined palm oil for delivery in September climbed 0.4 percent to 6,630 yuan ($1,067) a ton on the Dalian Commodity Exchange. Soybean oil for delivery in the same month gained 0.3 percent to 8,348 yuan a ton.
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