KUALA LUMPUR: Malaysian palm oil futures climbed as much as 3% on Monday to hover near record highs as vegetable oil markets got a boost from South American weather concerns, while a jump in exports also helped.
The benchmark palm oil contract for May delivery on the Bursa Malaysia Derivatives Exchange ended the session 138 ringgit higher, or 2.49%, at 5,677 ringgit ($1,358.78) a tonne.
Palm oil was up for a third consecutive session, closing at its highest since Feb. 15.
Exports from Malaysia for Feb. 1-20 rose between 24.9% and 29% from the same week in January, according to cargo surveyors Intertek Testing Services and Amspec Agri.
"Looking ahead, exports will likely remain firm, as Indonesia's Domestic Market Obligation (DMO) regulations, which mandated Indonesian palm oil producers to sell 20% of their planned exports to the domestic market at a fixed price, have curbed outflows from the country," Refinitiv Agriculture Research said in a note.
Palm oil closes higher, but posts third weekly loss
The increased exports may see February-end inventories falling amid already tight stocks.
The edible oils market has also been swayed by concerns over soybean crop losses in drought-hit South America, which may further tighten global supply.
Dalian's most-active soyoil contract rose 1.5%, while its palm oil contract jumped 2.2%. Rapeseed oil on the Zhengzhou Commodity Exchange rallied 3.3%.
The Chicago Board of Trade was closed for a public holiday.
"The rally is underpinned by weather concerns in South America that have slashed production estimates, some Chinese soybean crushing plants that planned to halt operations due to deteriorated crush margins and worries over the escalation of Ukraine-Russia tensions that will affect sunflower oil shipments from the Black Sea region," Refinitiv said.
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