- The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange gained 114 ringgit, or 2.72%, to 4,306 ringgit
KUALA LUMPUR: Malaysian palm oil futures climbed nearly 3% on Wednesday, extending gains for a second consecutive session, led by signs of slowing production and a recovery in rival soyoil prices.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange gained 114 ringgit, or 2.72%, to 4,306 ringgit ($1,028.67) a tonne by the midday break, its highest daily jump in six weeks.
"Market moved up on a rebound in soybean oil prices overnight," a Kuala Lumpur-based trader said.
"Anticipation of bullish outlook in Globoil starting tomorrow in India also added to short covering activities."
Leading industry analysts are expected to present their outlook at the Globoil India edible oil conference from Thursday to Saturday.
Southern Peninsula Palm Oil Millers' Association on Tuesday estimated Malaysia's production during Sept. 1-20 fell 4.5% from the same period in August, according to traders.
Dalian's most-active soyoil contract fell 1%, while its palm oil contract slipped 0.6%. Soyoil prices on the Chicago Board of Trade were up 0.9%.
Palm oil is affected by price movements in related oils, as they compete for a share in the global vegetable oils market.
Global stocks found support after teetering developer China Evergrande said it would pay some bond interest due on Thursday, allaying fears of an imminent and messy collapse that had spooked investors across assets.
Palm oil may bounce moderately into a range of 4,227-4,275 ringgit per tonne, before resuming its fall, Reuters technical analyst Wang Tao said.