KUALA LUMPUR: Malaysian palm oil futures hit a record high on Wednesday, helped by supply jitters amid escalating Russia-Ukraine crisis and dry weather in South America.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange gained 129 ringgit, or 2.21%, to 5,969 ringgit ($1,426.63) a tonne by the midday break, extending gains for a fifth consecutive session.
The spot contract rose 1.76% to an all-time high of 6,466 ringgit.
"Second month (contract) surpassed the 6,000 ringgit mark and third month look poised to do the same," said Sathia Varqa, co-founder of Singapore-based Palm Oil Analytics.
Palm oil exports rising faster than its production in February, along with strong externals of crude oil and gains in related edible oils are all supporting prices, he said.
The Malaysian Palm Oil Association on late Tuesday estimated production during Feb. 1-20 fell 1.79% from the month before, traders said.
Investors are assessing the impact of new sanctions by the West on Russia for ordering troops into separatist regions of eastern Ukraine and threatening to go further if Moscow launched an all-out invasion of its neighbour.
Oil prices took a breather after surging to seven-year highs.
Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.
Most-active Chicago soyoil contract extended a 3.6% overnight jump to record highs as traders monitor impact of dry weather on South American soybean production.
In China, Dalian's most-active soyoil contract rose 0.5%. Its palm oil contract rose 4.2%, its highest since July 2008.
Palm oil may rise to 5,986 ringgit per tonne, driven by a wave (5), Reuters technical analyst Wang Tao said.
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