Palm hits record high of nearly 5,000 ringgit, posts 10% weekly jump

KUALA LUMPUR: Malaysian palm oil futures reversed early losses on Friday to hit a record high of nearly 5,000 ringgit ($1,197.32) a tonne, setting the contract for a 10.2% weekly surge tracking Dalian prices, helped by tight supply outlook.

The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange closed up 117 ringgit, or 2.41%, to 4,966 ringgit ($1,189.18) a tonne, rising for a third consecutive week.

The contract is adjusting to rival oil prices on the Dalian exchange, a Kuala Lumpur-based trader said.

The Dalian exchange reopened trading after a week-long holiday in China. Its most-active soyoil contract jumped 4.7%, while its palm oil contract surged 7.2%.

Soyoil prices on the Chicago Board of Trade were up 0.7%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Palm ends three-day rally weighed down by crude, supply fears cap losses

Oil prices rose, and were on track for nearly 5% gains this week, on signs some industries have begun switching fuel from high-priced gas to oil and on doubts the US government would release oil from its strategic reserves for now.

Stronger crude oil futures make palm a more attractive option for biodiesel feedstock.

Indonesia's August exports of palm oil, including refined products such as oleochemicals, rose 59% year on year to 4.27 million tonnes, data from the Indonesian Palm Oil Association (GAPKI) showed.

The world's top palm oil exporter produced 4.56 million tonnes of crude palm oil in August and end-of-month stock stood at 3.43 million tonnes, GAPKI data showed.

Focus is now on Malaysian Palm Oil Board's supply and demand data releasing on Monday. A Reuters poll pegged end-September stockpile to fall 0.36% from the previous month to 1.87 million tonnes amid lackluster output. g text**