Malaysian palm oil rises

Malaysian palm oil futures rose more than 2 percent to a three-week high on Tuesday, supported by rising enquiries from Indian and Chinese importers, traders and analysts said. Palm oil, which has gained more than 16 percent this month, is expected to strengthen as China resumes buying and India steps up imports during the lean domestic production months.
The benchmark June contract on Bursa Malaysia Derivatives Exchange finished up 2.6 percent, or 95 ringgit, to 3,690 ringgit ($1,165) per tonne, a level not seen since March 26. "Exports are showing a good recovery. The bullish trend seems to have returned," said one dealer with a leading plantation firm in Kuala Lumpur.
"It is possible to cross 4,000 ringgit mark in the coming weeks, but it will depend on how buyers react to higher prices." Other traded months rose between 87 and 118 ringgit per tonne in overall trade of 12,141 lots of 25 tonnes each. Open interest, which indicates the number of players in the market, stood at, 42,040 lots.
Malaysian palm oil exports in the first half of April stood at 579,397 tonnes, down 12.8 percent from a month ago, but sharply higher than a decline of 41 percent between April 1 and 10, cargo surveyor Intertek Testing Services said. Another cargo surveyor, Societe Generale de Surveillance, said exports fell 6.6 percent to 630,431 tonnes.
Malaysian palm oil futures are likely to rise as high as 4,500 ringgit per tonne between September and February 2009, top industry analyst Dorab Mistry told an industry seminar in Dubai on Monday.
Mistry, a director with India's commodities-to-appliances firm Godrej International, forecast strong demand from China, India and other traditional palm oil market from May. Soyoil for May delivery at the Chicago Board of Trade rose 1 percent in trade during Asian hours while the most-active September contract on China's Dalian Commodity Exchange was up 5 percent.
Mistry also said the price of soybean oil could rise to $1,800 if there was a weather problem in US soybean growing months. In Malaysia's physical market, crude palm oil for April shipment in the southern region was quoted at 3,650/3,670 ringgit a tonne. Trades were done at 3,660-3,665 ringgit.