NEW DELHI: Palm oil burst through RM3,500 a tonne to the strongest level in more than eight years on optimism that rising exports from Malaysia will deplete the country’s stockpiles and that stronger prices for rival soybean oil will increase the appeal of palm oil.
“It’s a rebound after the lackluster trade yesterday, ” said Sathia Varqa, owner of Palm Oil Analytics in Singapore.
“Prices regained their footing from a better export outlook for December and lower output. Higher prices for Dalian and Chicago soybean oil are also supportive.”
Malaysia’s palm oil exports climbed 8.7% in the first 15 days of December from a month earlier, according to AmSpec Agri. Intertek Testing Services reported a 9.8% increase.
The Southern Peninsular Palm Oil Millers Association’s data on Dec. 1-15 output are expected to show a decline, Varqa said.
The group reports the pace of growth covering fresh fruit bunch yields, oil extraction rates and crude palm oil production every five days compared with the same time a month earlier, Varqa said.
The data are the closest indicator for performance of crude palm oil output in peninsular Malaysia.
Soybean oil in Chicago is up for a sixth day, the longest winning run since April, buoyed by strikes among processors and grain inspectors that are crippling ports in Argentina, the biggest exporter of soybean oil and meal. - Bloomberg