MUMBAI: Malaysian palm oil futures rebounded on Wednesday from a 3-1/2-month low hit in the previous session, tracking gains in rival soyoil amid hopes that exports would improve at lower price levels.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange rose 22 ringgit, or 0.62%, to 3,587 ringgit ($759.15) per metric ton by the midday break.
“Malaysian stocks rose in line with market expectations, but now demand seems to be improving at a lower price level. Export numbers were quite good for the first 10 days,” said a Mumbai-based edible oil trader.
Exports of Malaysian palm oil products for Oct. 1-10 rose 12.5% to 29.6% from a month earlier, data from cargo surveyors showed.
Malaysia’s palm oil stocks at the end of September rose 9.6% to 2.31 million tons, the highest level in 11 months, data from the Malaysian Palm Oil Board (MPOB) showed.
Crude palm oil production in September increased 4.33% month-on-month to 1.83 million tons, while palm oil exports dropped to 1.2 million tons, MPOB said.
Soyoil futures on the Chicago Board of Trade were up 0.19%, as of 0439 GMT.
The downward revision in U.S. soybean crop production estimate is also supporting soyoil and other edible oils, the Mumbai-based trader said.
The U.S. Department of Agriculture rated 51% of the soybean crop in good-to-excellent condition, down from 52% a week ago and the lowest for this time of year since 2012.
Oil prices were little changed in early Asian trade, as concerns eased about potential supply disruptions due to the conflict between Israel and the Palestinian Islamist group Hamas.
Flag carrier Garuda Indonesia said on Tuesday it had completed a test flight using a palm oil-blended jet fuel on a Boeing 737-800NG aircraft.
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