El Nino lifts palm oil gain to 5-year high

The black swan: The El Nino may curb oil palm yields in Indonesia and Malaysia, which account for 86 of supply, as the event can bake parts of Asia while bringing too much rain to Latin America. — EPA

KUALA LUMPUR: Palm oil posted its biggest annual gain in five years as the strongest El Nino in almost two decades parches crops in South-East Asia and trims record stockpiles of the commodity used in food and biofuel.

Prices rose 9.7% this year, the first annual rise since 2013 and the most since 2010. Futures for March delivery on Bursa Malaysia Derivatives rallied to an 18-month high yesterday before closing 0.4% lower at RM2,485 in Kuala Lumpur. Prices surged 6% this month and 4.6% this quarter.