Malaysian crude palm futures rose nearly 2 per cent yesterday as more investors streamed back into the market, heartened by concerns of sharp falls in domestic production this month, traders said.
Palm oil, used in biscuits to biofuels, bounced from three-week lows hit the previous day and snapped three straight days of losses although weakness in US soyaoil markets cut some gains in Asian trade.
“There is some talk that January production might have fallen by 20 per cent, which is the result of plantations cutting down on fertilisers six months ago during the palm price slump,” a head trader with a local brokerage said.Output would then probably be 1.19 million tonnes in January compared with 1.48 million the month before, traders say.
The benchmark April contract closed up RM34 at RM1,779 as traders were also taking positions ahead of a long holiday weekend. The Malaysian palm oil market will be closed on Monday.
Other traded contracts ranged between a RM20 drop to gains of RM40. Overall volume shot up to 13,970 lots of 25 tonnes from 10,000 lots.
Traders were also eyeing Jan. export data by cargo surveyor Intertek Testing Services due over the weekend while Societe Generale de Surveillance reports on Monday.
Exports are expected to be bearish given the deepening recession. - Reuters
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