KUALA LUMPUR: Malaysian palm oil futures rose on Wednesday for a fifth session on strength in broader markets, although the contract surrendered most of its early gains on fears of ballooning inventories.

The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange rose 26 ringgit, or 0.72%, to 3,640 ringgit ($786.35) a tonne.

Palm had earlier hit an intraday high of 5.4% on stronger soybean oil and energy prices in the previous session, according to a Kuala Lumpur-based trader.

But the gains would be short-lived as global markets were still in the doldrums, the trader said.

Soyoil prices on the Chicago Board of Trade eased after a 2.3% rise overnight. The Dalian exchange was closed for the week for holidays.

Oil prices moderated slightly after gaining more than 3% in the previous session ahead of a meeting of OPEC+ producers to discuss a big cut in crude output.

Palm gains for third session on stronger crude

Stronger crude oil futures make palm a more attractive option for biodiesel feedstocks.

Limiting gains, Malaysia’s end-September palm oil inventories likely swelled 8% from the previous month to 2.27 million tonnes, their biggest in nearly three years, a Reuters survey showed.

Output was pegged to rise 2% to 1.76 million tonnes, while exports were seen 8% higher at 1.41 million tonnes.

Asian stocks rose as investors grew hopeful future global interest rate rises might become less aggressive amid early signs previous policy tightening was working to temper price pressures in some major world economies.