Malaysian palm oil rose for a third straight day on Tuesday, closing up 1.3 percent, after Chicago soy prices firmed in post-holiday trade in Asia. The Chicago Board of Trade was closed on Monday for the US Independence Day holiday, depriving crude palm oil futures on Bursa Malaysia Derivatives of fresh leads.
It reopened for electronic trading in Asia on Tuesday, with soybean futures rallying on reports of dry weather in Illinois, the United States' top soy growing area.
Soyoil for August delivery was also up 0.37 cent a pound, after showing a 0.13 cent loss in early trade.
"It's good that we got some solid direction in the afternoon from the soyoil and that's partly the reason why we're up," said a palm oil trader in Kuala Lumpur.
Soy and palm products compete for exports and prices on the CBOT and Bursa Malaysia often move in step.
At Tuesday's close, the benchmark third-month crude palm oil contract on Bursa Malaysia, September, was up 18 ringgit, or 1.3 percent, at the day's high of 1,436 ringgit ($377.89) a tonne. The contract has risen a total of 28 ringgit over the last three days.
Other contract months settled up 13 to 18 ringgit. The volume transacted was 5,502 lots of 25 tonnes each - not far below the 6,000 lots typically seen on a busy day.
Physical prices of crude palm oil rose on the strength of the futures market.
Contracts for July and August saw bids at 1,435 ringgit a tonne in Malaysia's central and southern regions, against offers at 1,440 ringgit. On Monday, bids/offers were 20 ringgit lower.
Trades for July were reported at 1,430-1,435 ringgit in the central and southern regions. Business for August was noted in the south only, at 1,430 ringgit. (Repeats to fix format)
PALM OIL FUTURES:
July (south): 1440.00
Open/High/Low: 1420/1436/1419
Previous close: 1420.00
PALM OIL PHYSICALS:
September (3rd month): 1436
Previous settlement: 1418
FUTURES:
Benchmark third-month September up 18 ringgit at 1,436 ringgit ($377.89) a tonne.
PHYSICALS:
Offers for July up 20 ringgit at 1,440 ringgit a tonne in the south.