yesterday after reports showed that sales from Malaysia, the
second-biggest producer, gained last month.
October-delivery
futures advanced as much as 2.1 per cent to RM2,570 a metric ton on the
Malaysia Derivatives Exchange, the highest level since April 27, and
traded at RM2,565 at 5.15 pm in Kuala Lumpur. Prices added 6.1 per cent
in July, the biggest monthly gain in five.
Palm oil exports from
Malaysia climbed 4.4 per cent in July to 1,412,300 tons from a month
earlier, market surveyor Intertek said July 31. Rival Societe Generale
de Surveillance said sales gained 4.7 per cent to 1,402,317 tons last
month.
Crude oil rose to the highest in four days as Asian stocks rallied after
China’s manufacturing rose in July, increasing the appeal of palm oil
as a biofuel feedstock. September-delivery crude oil added as much as
0.7 per cent to US$79.53 a barrel on the New York Mercantile Exchange.
“Everything seems to be supportive for palm oil today,” said Ryan Long, a trader at OSK Investment Bank Sdn Bhd.
“Better-
than-expected exports from Malaysia and higher crude are all pointing
to a firm trend. The only negative is a strong ringgit.”
The
ringgit rose to a two-year high on optimism investors will pump more
funds into Asian assets as regional economies lead the recovery from a
global recession, raising the cost for palm oil buyers. The currency
advanced as much as 1 per cent to 3.1514 per dollar in Kuala Lumpur,
according to data compiled by Bloomberg.
La Nina, which brings
above-normal rainfall in Asia, can disrupt palm oil production in
Indonesia and Malaysia, the top growers, and cause dry weather in North
America, hurting soybean crops.
Palm and soybean oils are substitutes and account for more than 60 per cent of global edible oils supplies and demand.
“It has been raining in Malaysia and that’s adding to some concern about future production outlook,” OSK’s Long said.
December-delivery
soybean oil jumped as much as 1 per cent to 40.94 cents a pound and the
vegetable oil’s premium over palm oil narrowed to US$88.48 a ton from
US$105.8 on July 30, according to Bloomberg data.
November-delivery soybeans rallied as much as 1.4 per cent to US$10.19 a bushel, the highest since April 26.
CME
Group Inc.’s October-delivery palm oil contract, pegged to the
Malaysian benchmark price, jumped as much as 2.4 per cent to US$811 a
ton, the highest since the contract started trading in May.
On
the Dalian Commodity Exchange, January-delivery palm oil surged 2.5 per
cent to 6,910 yuan (US$1,020) a ton, while soybean oil added 2 per cent
to 7,842 yuan a ton.
