Palm oil extends gains on higher crude, hopes of better exports

Oil prices rose after a sharp drop in U.S. crude inventories, making palm oil a more attractive option as biodiesel feedstock.

Agencies
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Malaysian palm oil futures climbed for a fourth straight session on Wednesday, hovering near a four-month high hit in the last session, on stronger crude oil and hopes of better exports.

The benchmark palm oil contract for September delivery on the Bursa Malaysia Derivatives Exchange rose 25 ringgit, or 1%, to 2,527 ringgit ($593.05) by 0239 GMT, after a 3% jump in the previous session.

Traders said on Tuesday they expected a 9%-10% drop on-month in July 1-15 exports, better than a 17%-18% decline in July 1-10 shipments.


Cargo surveyors are scheduled to release export data later in the day.

FUNDAMENTALS

Oil prices rose after a sharp drop in U.S. crude inventories, making palm oil a more attractive option as biodiesel feedstock.
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Dalian's most-active soyoil contract gained 1.82%, while its palm oil contract rose 3.03%. Soyoil prices on the Chicago Board of Trade were up 0.52%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

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