Palm rises on bargain buying, strong exports; set for second weekly gain

By Reuters News

JAKARTA, Oct 16 (Reuters) - Malaysian palm oil futures rose on Friday, supported by bargain buying and strong export demand, after cargo surveyors reported higher shipments in the first half of October, putting the market on track for a second consecutive weekly gain.

The benchmark palm oil contract for January delivery on the Bursa Malaysia Derivatives Exchange gained 50 ringgit, or 1.06%, to 4,775 ringgit ($1,169.77) a metric ton by the midday break.

The contract has gained 3.99% so far this week.

"The CPO futures were seen trading higher today on some bargain buying. Additionally, stronger Malaysian palm oil export for first half of October has also helped," said Anilkumar Bagani, research head of Mumbai-based vegetable oils broker Sunvin Group.

Cargo surveyors estimated that exports of Malaysian palm oil products during October 1-15 jumped between 43.2% and 58.3% from a month earlier.

Dalian's most-active soyoil contract fell 0.89%, while its palm oil contract slipped 0.84%. Soyoil prices on the Chicago Board of Trade were down 0.19%.

Palm oil tracks rival edible oils, as it competes for a share of the global vegetable oils market.

The ringgit , palm's currency of trade, weakened 0.05% against the dollar, making the commodity slightly cheaper for buyers holding foreign currencies.

India's palm oil imports in September jumped to a seven-month high as refiners tried to replace sunflower oil with palm oil.

Malaysia lowered its November crude palm oil reference price, keeping the export duty at 10%, a circular on the Malaysian Palm Oil Board website showed on Wednesday.

Oil prices eased on Friday but were heading for weekly gains on the uncertainty over Middle East supplies and a larger-than-expected crude stocks draw in the United States.O/R

Weaker crude oil futures make palm a less attractive option for biodiesel feedstock.


($1 = 4.0820 ringgit)


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