Malaysian palm oil rises

Malaysian crude palm oil futures ended 2.4 percent higher on Friday on the back of gains in the US soybean oil market and firm crude oil prices.
Traders said news of the Indonesian government's decision to raise crude palm oil export taxes, which came after the close of play, could further lift the market.
The benchmark third-month August contract on the Bursa Malaysia Derivatives Exchange settled up 57 ringgit, or 2.4 percent, to 2,425 ringgit ($701) a tonne, after hitting an intraday high of 2,441 ringgit. "The market is building up slowly on external influences such as strong crude oil and US soyoil," said a leading trader.
"As crude pushes above $70, palm oil becomes attractive again for biodiesel." Other traded months rose between 56 and 90 ringgit. Overall trade rose to 16,095 lots of 25 tonnes each compared with 12,000 lots that change hands on a routine day.
September palm oil on Singapore's Joint Asian Derivatives Exchange was up $33.20 to $706.00 a tonne in dull trade. Indonesia has raised the export tax for crude palm oil to 6.5 percent from 1.5 percent effective Friday in a bid to increase supplies in the domestic market, said chief economics minister Boediono.
"The Indonesian government's decision to hike exports tax could mean that players will stay in the market as prices will start to go up," said another trader. Palm oil has lost close to 14 percent since touching a peak of 2,764 ringgit last week on strong demand and a squeeze in supplies.
Exports of Malaysian palm oil products for June 1-15 fell 21 percent to 504,501 tonnes from 637,090 tonnes shipped between May 1 and 15, cargo surveyor Intertek Testing Services said on Friday. Another cargo surveyor, Societe General de Surveillance said exports in the same period fell 18.8 percent to 513,999 tonnes from 632,736 tonnes shipped between May 1 and 15.
Soyoil futures on the Chicago Board of Trade rebounded on Thursday after Wednesday's sell-off and was supported by the strength in crude oil, traders said. July soyoil closed 0.29 cent higher at 35.16 cents per lb, with the deferred months up 0.24 to 0.30 cent. In electronic trading during Asian hours on Friday, the July contract was up 1.11 percent at 35.55 cents a lb by 1049 GMT.
Oil retreated to below $71 a barrel on Friday after two days of gains sparked by worries of low fuel supplies from creaking US refiners and an upsurge of violence in the Middle East. Investors had bought the market higher after a weekly US report on Wednesday showed gasoline stocks failed to build up and heating oil inventories declined.
Brent crude, now more representative of the global market, was off 52 cents at $70.84 a barrel by 1049 GMT. Biofuels are taking on renewed global importance as countries seek to cut hazardous emissions and as crude oil hovers near record highs. In Malaysia's physical market, crude palm oil for June shipment was quoted at 2,560/2,580 ringgit a tonne. Trades were done between 2,540 and 2,560 ringgit.