Technical Buying and Fund Spreading Lift Vegetable Oil Prices

On Wednesday, vegetable oil prices rose as concerns about South American weather conditions and strong domestic demand in the U.S. continued to support soybean oil prices despite selling in the other soybean complex markets. The gains on Tuesday in soybean oil and bargain hunting at the 3,600-ringgit level drove buying in palm oil, which broke a streak of three days of declining prices. However, bearish cargo surveyor data and expectations that the Malaysian Palm Oil Board (MPOB) will report a substantial increase in stocks at the end of February combined with technical selling at the five-day exponential moving average to limit the gains.

The spread between May soybean oil and palm oil contracts dropped slightly to just above 8 3/4 cents per pound as resistance at the nine-cent level continues to limit further…