Palm oil marks strongest daily gain in nearly five months

Malaysian palm oil futures notched up their biggest daily gain in nearly five months on Friday, rising over 2 percent on a technical rebound and expectations that production will decline this month.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange was up 2.7 percent at 2,518 ringgit ($618) at the close of trade, its first gain in three sessions and its sharpest rise since July 25.
It earlier hit an intraday high of 2,525 ringgit, its highest level in a week, and rose 1.6 percent on the week after six consecutive weekly falls.
Palm oil, however, hit its lowest since August 2016 on Thursday due to high inventories and low demand, and has shed 3.3 percent so far this month after declining 7.5 percent in November.
Trading volumes totalled 64,331 lots of 25 tonnes each on Friday.
"The market is seeing a technical rebound after a sharp drop, it looks like yesterday it reached its bottom," said a futures trader in Kuala Lumpur.
"The market may start moving higher from now, as all negative factors are priced in."
Malaysian palm oil stocks at the end of November rose to 2.56 million tonnes, the highest since late 2015, while cargo surveyor data showed exports in the first half of December fell 9.6 percent from a month earlier.
Palm oil could break a resistance at 2,462 ringgit per tonne and rise towards the next resistance at 2,491 ringgit, according to Reuters market analyst for commodities and energy technicals Wang Tao.
In other related oils, the January soybean oil contract on the Chicago Board of Trade rose 0.9 percent, while the January soybean oil contract on the Dalian Commodity Exchange was down 0.9 percent.
The Dalian January palm olein contract dipped 0.2 percent.