Malaysian crude plam oil rose more than 2 percent on Thursday, bouncing back from a two-day fall, as crude oil recovered and as traders bet on improving overseas demand. The price of the reddish-brown oil, which is used for products ranging from soap to biodiesel, has fallen 17.7 percent so far this year, largely due to concerns about high stocks and news of defaults from key buyers India and China.
The benchmark November crude palm oil contract on the Bursa Malaysia Derivatives Excange ended up 59 ringgit, or 2.41 percent, to 2,510 ringgit ($733) a tonne. In the neighbouring Indonesian market, palm oil prices were mixed without any fresh supply-demand news and a volatile market kept players cautious.
Producers in Medan, North Sumatra - home to Belawan port, Indonesia's key port for palm oil exports - sold crude palm oil at 6,470 rupiah ($0.702) a kg, unchanged from 6,460-6,480 rupiah a kg on Wednesday. "Malaysia did not move much today. Also, players are still cautious because the market has been volatile these days," said a dealer in a plantation firm in Medan.
The state marketing centre in Jakarta sold crude palm oil at 6,544 rupiah a kg, down from 6,575 rupiah a kg on Tuesday, free on board Belawan port in North Sumatra. The centre which sells crude palm oil from state plantations, did not sell any crude plam oil at an auction on Wednesday due to low bids.
In Jakarta, refineries sold refined, bleached, deodorised (RBD) palm olein - used in cooking oil - unchanged at 7,000-7,150 rupiah a kg from Wednesday. In the physical market, crude palm oil for September delivery was at 2,500/2,520 ringgit a tonne in the south region. Trades were done at 2,500 ringgit a tonne.