Palm oil advanced on speculation that prices near a four-month low will increase demand for the tropical commodity used in food and fuel.

The contract for July delivery climbed as much as 0.4 percent to 2,310 ringgit ($763) a metric ton on the Bursa Malaysia Derivatives and ended the morning session at 2,300 ringgit. Futures, which have fallen for three straight weeks, closed at 2,293 ringgit on April 15, the lowest price this year.

Most commodities rebounded today with the Standard & Poor’s GSCI Index of 24 commodities climbing as much as 0.3 percent after touching the lowest level since July yesterday. Brent crude recovered after dropping below $100 a barrel for the first time since July amid signs the global economy may slow, curbing fuel demand.

“I see good demand from India, a lot of buying is taking place at these levels,” Vijay Mehta, a director at Commodity Links Pte, said by phone from Singapore.

Exports from Malaysia fell 4 percent to 648,275 tons in the first 15 days of April from the same period in March, Intertek said April 15. Shipments declined 7.2 percent to 629,990 tons in the same period, Societe Generale de Surveillance estimates.

Soybean oil for July delivery was little changed at 49.13 cents a pound on the Chicago Board of Trade and soybeans were also little changed at $13.7675 a bushel.

Refined palm oil for September delivery lost 0.2 percent to 6,138 yuan ($994) a ton on the Dalian Commodity Exchange, while soybean oil rose 0.2 percent to 7,672 yuan a ton.

To contact the reporter on this story: Ranjeetha Pakiam in Kuala Lumpur at rpakiam@bloomberg.net

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

Source : Bloomberg