KUALA LUMPUR- Malaysian palm oil futures on Thursday rose for a second straight session on the back of strength in rival soyoil, although gains were capped by expectations of a rise in February-end inventories and production.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange closed up 47 ringgit, or 1.28%, to 3,725 ringgit ($918.62) a tonne.
"The rally of vegetable oil prices, from sunflower to soybean, was the catalyst behind the rally in prices," said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari.
Malaysia's palm oil inventories at end-February likely rose for a second straight month to touch 1.42 million tonnes, a Reuters survey showed on Thursday.
Production was expected to have risen 5.8% to 1.19 million tonnes, after declining for four months in a row as La Nina weather pattern and a pandemic-induced labour shortage disrupted harvesting.
The Malaysian Palm Oil Board is scheduled to release official February supply and demand data on March 10.
Dalian's most-active soyoil contract rose 2.3%, while its palm oil contract climbed 1.6%. Soyoil prices on the Chicago Board of Trade BOcv1 were up 0.7%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
($1 = 4.0550 ringgit)
(Reporting by Mei Mei Chu; Editing by Subhranshu Sahu, Aditya Soni and Shailesh Kuber) ((Meifong.chu@thomsonreuters.com))
