KUALA LUMPUR: Malaysian palm oil futures reversed course to hit a three-week closing high on Thursday, triggered by bargain buying amid tight suppllies as Indonesian oil remains absent from the global market.

The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange gained 156 ringgit, or 2.44%, to 6,539 ringgit a tonne, its highest closing price since May 5.

Leading edible oil analyst Dorab Ministry on Thursday urged Indonesia to immediately resume exports of palm oil, warning that a halt in shipments pending details of a domestic sales rule could spell economic “doom” for farmers.

In an open letter to the Indonesian government, Mistry said the world’s biggest palm oil producer and exporter was heading to a “calamitous situation” due to a cocktail of record stocks, full storage tanks, boom cycle in production, poor demand and restricted exports.

The benchmark contract fell during early trade, tracking weakness in soyoil, pressured by good planting weather forecast, as well as concerns over demand from China, a Kuala Lumpur-based trader said.

India’s palm oil imports could fall to 11-year low

Plunging demand for soyoil in China is expected to cut consumption of the oilseed in the world’s biggest user as lockdowns to prevent the spread of COVID have shuttered restaurants and canteens, according to traders and analysts.

ICE Canada canola futures fell on Wednesday after a report said Russia was ready to provide a humanitarian corridor for vessels carrying food to leave Ukraine, a major sunflower oil producer, if some sanctions were lifted.

A resumption of Black Sea sunflower oil shipments could helpalleviate global supplies, the Kuala Lumpur-based trader said.

Dalian’s most-active soyoil contract gained 0.05%, while its palm oil contract fell 0.9%. Soyoil prices on the Chicago Board of Trade were down 0.04%.