KUALA LUMPUR: Malaysian palm oil futures advanced over 2% on Tuesday, extending gains for a second session, as the market tracked a rally in soyaoil fuelled by US President Joe Biden’s green energy push but signs of higher production capped the gains.

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange settled up 87 ringgit, or 2.26%, to 3,930 ringgit ($953.88) a tonne.

Palm rose as much as 4.4% during the session.

Biden’s green fuel push using edible oils is helping drive up vegetable oil prices that are already near record highs, hitting key cost-sensitive consumers in India and Africa and stoking global food inflation fears.

“Prices moved up on strong soyaoil overnight and Asian morning session, green fuel initiatives by the U.S president caused soyaoil to spring up,” a Kuala Lumpur-based trader said.

“Market will be taking cues from soyaoil in the next few days,” the trader said.

The selling pressure is, however, weighing on the market as crude palm oil enters the seasonal-induced productive months, he added.

Soyaoil prices on the Chicago Board of Trade were up 1.4%. Dalian’s most-active soyaoil contract rose 3.4%, while its palm oil contract gained 4.7%.

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

Top producer Indonesia set its crude palm oil reference price for April higher at $1,093.83 per tonne, an official at the country’s coordinating economics ministry said, bringing export taxes higher.

Malaysia’s exports of palm-based biodiesel are likely to fall this year to their lowest since 2017 due to European Union restrictions and the coronavirus pandemic, the Malaysian Biodiesel Association (MBA) said at a conference.