Palm oil prices on the European market were higher on Friday after Indonesia's parliament approved a threefold increase in biodiesel subsidies. Dealers said the higher subsidy, which could take effect next month, would make blending profitable. Malaysian palm oil futures also rose on Friday, ending the week with the biggest weekly gain in six years.
The Indonesian government's proposal to ramp up biodiesel subsidies overcame its final parliamentary hurdle on Friday, an Energy Ministry official said. Crude palm oil offers were raised by up to $15 a tonne with April/June shipment at $705 a tonne, up 11 percent from the level sought at the end of last week. The run-up in palm oil has also boosted selling prices for liquid oils - EU rapeoil, soyaoil and sunoil - this week, though buyers were reluctant to pay those levels. "There have been no buyers, no action," one dealer said, referring to the liquid oils market.