SINGAPORE: Malaysian palm oil futures gained on Wednesday and were on track to snap three days of losses, with investors buying after prices marked a one-month low earlier in the session and on concerns year-end floods in the country could hurt production.
"I heard there are worries about floods in the Johor area, and we have also see some technical buying," said a Singapore-based trader with a global commodities house, referring to the state that accounts for almost 15 percent of Malaysia's total palm production.
By the midday break, the benchmark January contract on the Bursa Malaysia Derivatives Exchange had gained 1.6 percent to 2,410 ringgit ($790) per tonne. Prices earlier fell to their weakest since Oct. 8 at 2,364 ringgit.
Total traded volumes stood at 17,471 lots of 25 tonnes each, higher than the usual 12,500 lots.
Technicals showed palm oil could rebound to 2,423 ringgit, as support held firm at 2,377 ringgit, said Reuters market analyst Wang Tao.
Malaysia's palm oil exports rose 10 percent to a 2012-high at 1.6 million tonnes in October, and the steep discount between palm oil and soybean oil could uncover more demand and help ease swelling stocks.
Stock levels in Malaysia, the world's No.2 palm oil producer, were projected to reach a record 2.67 million tonnes in October, a Reuters survey showed on Tuesday.
Traders will be looking for more trading clues as cargo surveyor Intertek Testing Services releases Malaysian exports data for Nov. 1-10 on Saturday and as industry regulator the Malaysian Palm Oil Board issues October stocks data on Monday.
In related markets, Brent futures held below $111 per barrel on Wednesday as concerns about weak demand in a fragile economy and Greece outweighed supply disruption worries on escalating tension in the Middle East.
Uncertainty about the US election eased after television networks projected a victory for President Barack Obama against Republican challenger Mitt Romney in a tight race.
Other vegetable oil markets continued to edge higher. US soyoil for December delivery inched up 0.5 percent in early Asian trade, while the most active May 2013 soybean oil contract on the Dalian Commodity Exchange had climbed 0.3 percent by the midday break.
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