Malaysian palm oil gains

Malaysian crude palm oil futures ended 0.7 percent higher on Tuesday, just shy of a seven-week high hit the day before as rival soybean oil and crude oil markets rose in Asian trade. The most-active December contract on the Bursa Malaysia Derivatives Exchange settled up 19 ringgit, or 0.7 percent, at 2,609 ringgit ($748) a tonne.
On Monday, the contract rose to 2,619 ringgit tonne, a level not seen since August 1. "Palm oil does not show any immediate sign of retreating because the soyoil and crude oil prices are just going higher and higher," said a trader. "The slightly rise in exports have no bearing today." Other traded months rose between 17 and 25 ringgit in overall trade of 8,633 lots of 25 tonnes each.
The Chicago soyoil market soared to a 23-year high of 39.95 cents per lb in the spot October contract overnight due to worries about potential crop damage after a weekend cold spell in the upper Midwest. The contract hovered at 39.95 cents a pound by 1020 GMT in Asian hours on Tuesday.
Oil leapt to an all-time high above $81 a barrel on Tuesday, drawing strength from concerns about a winter supply squeeze in top consumer the United States, where an anticipated interest rate cut is calming recession fears.
Hurricane and other supply risks, tightening US fuel inventories and fund flows into energy from poorly performing equity markets have fuelled oil's rally - which has taken US crude to new record highs for five consecutive trading sessions. US crude was up 38 cents to $80.95 a barrel by 1020 GMT after hitting a record peak of $81.24 and following a $1.47 jump on Monday.
Crude oil market often lends support to vegetable oils, including palm and soybean, because of their growing use in making biodiesel, which competes with petroleum diesel. Palm oil, used in making sweetmeats and other delicacies during current festive season in Asia, is just 5.6 percent off an historic high of 2,764 ringgit reached in June.
Exports of Malaysian palm oil products for September 1-15 rose 10.7 percent to 631,096 tonnes from 570,107 tonnes shipped between August 1 and 15, cargo surveyor Intertek Testing Services said on Saturday. Another cargo surveyor, Societe Generale de Surveillance, said exports in the same period rose 2.2 percent to 601,562 tonnes.
Pakistan has bought about 140,000 tonnes of palm oil for September shipment to meet strong demand during the Muslim holy month of Ramadan, but imports are likely to decline later, an industry official said on Tuesday.
The South Asian nation, which has emerged as a big importer of palm products because of higher soyoil and oilseed prices, is expected to buy up to 300,000 tonnes of palm oil between October and December, Rasheed Janmohammed, vice-chairman of the Pakistan Edible Oil Refiners' Association, said.
Malaysian palm oil output rose 14.83 percent to 1.6 million tonnes in August and reserves increased by 10.95 percent to 1.45 million tonnes, according to the Malaysian Palm Oil Board. December palm oil on Singapore's Joint Asian Derivatives Exchange was untraded by 1020 GMT with the January contract rising 1.1 percent to $759.50 a tonne with only five contracts traded.
In the physical market, crude palm oil for September shipment in the southern region was quoted at 2,640/2,645 ringgit a tonne. Trades were done between 2,640 and 2,645 ringgit.