Palm oil for March delivery advanced 0.8 per cent to RM2,702 a metric ton on the Malaysia Derivatives Exchange, the highest level since May 13. The contract rose as much as 1.6 per cent in intraday trading.
Crude oil traded near a 14-month high in New York as cold weather improved the outlook for energy demand in the world’s largest energy-consuming nation. The eastern half of the US is facing its coldest winter since 1982, AccuWeather.com said. Oil traded at US$81.72 a barrel at 5.59 pm Singapore time.
“We have to prepare for more supply side disruptions due to weather phenomenon,” said Sunny Verghese, chief executive of Olam International Ltd., a Singapore-based food ingredients supplier.
The cold snap “is an added bit” that may affect crops in the northern hemisphere including grains, sugar, rice, oil palms and cocoa trees, he said yesterday.
Indonesia, the biggest palm oil producer, accepted bids for 8,000 tons in auctions in Jakarta yesterday. Palm oil for delivery from Dumai port in Riau province traded at 7,630 rupiah a kilogram and 7,641 rupiah a kilogram, up from between 7,568 rupiah and 7,575 rupiah on Tuesday.
PT Astra Agro Lestari, the nation’s largest publicly traded plantation company, sold 6,000 tons of 7,000 tons palm oil offered. Separately, PT Kharisma Pemasaran Bersama Nusantara, that sells palm oil from state plantations, accepted bids for 2,000 tons out of 5,000 tons of palm oil auctioned
A cold front in China will move south today to provinces of Zhejiang, Jiangxi and Hunan, the China Meteorological Administration said in an e-mailed statement yesterday.
In the 2008 frost, rapeseed output in China, the world’s biggest grower, was reduced as 64 per cent of the 1.1 million acres (445,154 hectares) planted in the key growing region of Jiangsu was damaged in January, sparking an 11-per cent rally in the first quarter for palm oil as a substitute.
“The China frost provides a positive influence to market sentiment,” even though there are no reports of crop damage yet, said Ryan Long, a trader at OSK Investment Bank in Kuala Lumpur.
September-delivery palm oil on the Dalian Commodity Exchange rose 0.4 per cent to 7,376 yuan a metric ton, the highest since September 4 2008.
Soybean oil for March delivery in Chicago rose as much as 0.9 per cent to 41.45 cents a pound in Asian trading, and is trading at 41.20 cents at 5.58 pm, making it USD$110 a ton more expensive than palm oil, according to Bloomberg data.
Source : Business Times