JAKARTA: Malaysian palm oil futures closed more than 2% higher on Tuesday as trading resumed after a long holiday weekend, with gains in rival Dalian and Chicago soyoil prices supporting the market.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange climbed 103 ringgit, or 2.71%, to 3,905 ringgit ($828.03) a metric ton on the closing. Malaysia’s financial markets were shut on Monday for a public holiday.

“Trading resumed on Tuesday on a positive note, borrowing strength from CBOT (Chicago Board of Trade) soybean oil and Dalian palm olein,” a Kuala Lumpur-based trader said.

“Continued strength of rival oilseeds and short-covering activity at noon lifted price to midday highs.” Soyoil prices on the CBOT climbed 1.67%. Dalian’s most-active soyoil contract was up 1.48%, while its palm oil contract increased 1.24%.

Soybean prices impact the cost of soyoil, which competes with palm oil for a share in the global vegetable oils market. India’s imports of palm oil and sunflower oil in 2022/23 surged by 24% and 54%, respectively, to record highs on a rebound in consumption and as both oils were available at a steep discount compared to rival soyoil. Higher purchases by India, the world’s biggest importer of vegetable oils, could help to lower palm oil stocks in Indonesia and Malaysia. The buying could reduce inventories in sunflower oil-producing Black Sea countries.

Malaysia is confident exports of its palm oil and related products to China will increase further this year, Bernama state news agency reported on Tuesday, citing the plantations and commodities minister. Malaysia’s palm oil stockpiles stood at a four-year high at the end of October despite more-than-expected exports, data from the Malaysian Palm Oil Board showed on Friday.