Palm oil climbed to the highest level in almost a month on speculation that an increase in exports from Malaysia and a decline in output will reduce inventories in the world’s largest producer after Indonesia.
The contract for delivery in June advanced as much as 1.4 percent to 2,477 ringgit ($794) a metric ton on the Malaysia Derivatives Exchange, the highest price for the most-active contract since Feb. 25, before trading at 2,474 ringgit at 12:20 p.m. in Kuala Lumpur.
Exports from Malaysia gained 14 percent to 922,987 tons in the first 20 days of this month from the same period in February, Societe Generale de Surveillance said yesterday. Inventories dropped 7.2 percent to 2.44 million tons in February from an all-time high of 2.63 million tons in December, according to the Malaysian Palm Oil Board.
“Exports are encouraging and that’s quite positive,” said Arhnue Tan, an analyst at Alliance Investment Bank Bhd. “We are still supposed to be going through a low-production period, so hopefully we can see stockpiles drop a bit sharper in March.”
Output, which is the lowest in the first two months of the year, may drop this month as well due to a change in the cropping pattern, Tan said. Production slumped 19 percent to 1.3 million tons last month, palm oil board data show.
Soybean oil for May delivery climbed 0.8 percent to 50.26 cents a pound on the Chicago Board of Trade, while soybeans for May gained 0.8 percent to $14.31 a bushel.
Refined palm oil for September delivery advanced 1.7 percent to 6,450 yuan ($1,038) a ton on the Dalian Commodity Exchange. Soybean oil rose 1 percent to 8,178 yuan a ton.
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Source : Bloomberg