Malaysian palm oil up

Malaysian crude palm futures ended 1.6 percent higher on Friday, lifted by strong prices of soyaoil and expectations of a steady increase in exports this month. Traders said concerns over dwindling palm oil reserves, which are likely to dip further this month, also affected the market.
The benchmark August contract finished up 37 ringgit, or 1.6 percent at 2,370 ringgit ($697) a tonne after hitting as session high of 2,382 ringgit. "It's a commodity boom, especially with soyaoil that is impacting palm oil today," said one dealer. "Also, the market is factoring in expectations that export data on Monday will be strong."
"The market is already full of players, who need to secure supplies of CPO as the shortage of palm oil will worsen this month," said another dealer. The palm oil market has gained close to 19 percent this year after surging 40 percent in 2006 on the back of demand from the bodiless and food sectors.
Shares of palm plantation firms have hit record highs on bullish prices, led by sector bellwethers such as IOI Corp, Kuala Lumpur Keeping and Golden Hope.
Malaysia's plantation index has risen more than 40 percent this year. Malaysia's Synergy Drive, a new entity that is set to become the world's largest listed oil palm planter, expects palm oil yields to increase to 25 tonnes per hectare from 21 tonnes, the firm said on Friday.
Other traded months rose between 15 and 59 ringgit. Overall volume stood at 11,253 lots of 25 tonnes each. Soyaoil futures at the Chicago Board of Trade were up in trade during Asian hours with the July contract rising 0.17 percent to 35.05 cents a lb.
Malaysian palm oil usually follows the US soyaoil market because both commodities are used in products ranging from food and cosmetics to bodiless. The Malaysian Palm Oil Board said the country's April closing stocks fell 11.65 percent to 1,181,320 tonnes, the lowest in almost three years.
The board said palm oil output in April rose 4.11 percent, less than expected, and exports showed a steady growth of 5.9 percent. Exports of Malaysian palm oil products between May 1 and 15 fell 4.5 percent to 637,090 tonnes from 666,793 tonnes shipped in April 1-15, according to cargo surveyor Interlake Testing Services.
Another surveyor, Society General de Surveillance, said exports during the period fell 1.5 percent to 632,736 tonnes from 642,492 shipped in April 1-15. Dealers say the decline in exports was marginal and buying from India and China was expected to pick up.
In the physical market, crude palm oil for May shipment in the southern region was quoted at 2,525/2,535 ringgit a tonne. Deals were done between 2,520 and 2,530 ringgit.