Palm rebounds on likely new Indonesia biodiesel blend rule
Malaysian palm oil futures climbed on Friday to end the week higher, buoyed by hopes that demand in Indonesia will rise due to a potential new biodiesel rule next year, while traders awaited industry data for further direction.
The benchmark palm oil contract FCPO1! for February delivery on the Bursa Malaysia Derivatives Exchange rose 1.12% to close at 3,987 ringgit ($905.93), after shedding 3.33% in the previous two sessions. It gained 0.89% for the week.
Some traders were, however, worried about the smaller-than-expected blend. Market participants had expected a 40% blend, the level Indonesian authorities were testing on vehicles.
Dalian's palm oil contract (DCPv1) was down 0.77%, while its most active soyoil contract (DBYv1) dropped 0.24%. Soyoil prices on the Chicago Board of Trade (BOc2) rose 0.28% in the afternoon Asia hours.
Palm oil is affected by price movements in related oils, as they compete for a share in the global vegetable oils market.
($1 = 4.4010 ringgit)