KUALA LUMPUR: Malaysian palm oil futures climbed more than 2% on Tuesday, extending gains to a fourth session on the back of strength in crude and soyoil prices.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange gained 92 ringgit, or 2.69%, to 3,518 ringgit ($757.21) a tonne by the midday break.
Stronger macroeconomics, crude market and soy oil complex provided extra boost to palm oil, said Mitesh Saiya, trading manager at Mumbai-based trading firm Kantilal Laxmichand & Co.
Key buyers in China and Europe are queuing up for purchases as crude palm oil trades near 15-month lows, he said.
Meanwhile, Refinitiv Commodities Research said in a note on Monday that the price recovery was not sustainable amid tightening U.S. monetary policy and ample supplies.
Top producer Indonesia may extend a export levy waiver to the end of the year, chief economic minister Airlangga Hartarto said. Indonesia is currently waiving levies imposed on exports of palm oil products until the end of October.
Cheaper Indonesian exports may hurt demand for rival Malaysian palm oil.
In key buyer India, imports of palm oil jumped in September to their highest in a year, boosted by strong demand for the tropical oil ahead of the festival season and a steep discount to rival oils, six dealers told Reuters.
Oil prices edged higher as expectations that OPEC+ may agree to a large cut in crude output outweighed concerns about the global economy, making palm a more attractive option for biodiesel feedstock.
Soyoil prices on the Chicago Board of Trade extended a 2.6% overnight gain. The Dalian Commodity Exchange was closed for the week for a national holiday.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Palm oil may extend its gains into a range of 3,549 ringgit to 3,608 ringgit per tonne, as it has more or less broken a resistance at 3,477 ringgit, Reuters technical analyst Wang Tao said.