Palm opens higher on firmer Chicago soyoil, weak crude caps gains

Malaysian palm oil futures inched higher on Thursday, supported by stronger Chicago soyoil, though weaker crude oil prices limited the gains.

The benchmark palm oil contract FCPO1! for November delivery on the Bursa Malaysia Derivatives Exchange gained 23 ringgit, or 0.52%, to 4,465 ringgit ($1,061.83) a metric ton in early trade. The contract fell 0.76% in the previous session. The Malaysian bourse will be closed on Friday for a public holiday.

FUNDAMENTALS

* Dalian's most-active soyoil contract (DBYcv1) fell 0.05%, while its palm oil contract CPO1! shed 0.02%. Soyoil prices on the Chicago Board of Trade ZL1! gained 0.06%.

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

* Oil prices slid, extending a decline of more than 2% in the previous trading session, as investors and traders look ahead to a weekend meeting of OPEC+ where producers are expected to consider another increase in output targets. O/R

* Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.

* Malaysia's palm oil inventories are forecast to rise for a sixth consecutive month in August, as production continues to outpace exports despite a recovery in demand, a Reuters survey showed on Wednesday.

* The ringgit USDMYR, palm's currency of trade, strengthened 0.02% against the dollar, making the commodity slightly expensive for buyers holding foreign currencies.

* Palm oil may test support zone of 4,367 ringgit to 4,381 ringgit per metric ton, a break below could open the way toward 4,343 ringgit, Reuters technical analyst Wang Tao said. TECH/C