KUALA LUMPUR, May 11: Malaysian crude palm oil futures closed higher on Friday, lifted by a sharp decline in palm oil stocks and a steady increase in exports, dealers said.
The benchmark third-month July contract on the Bursa Malaysia Derivatives Exchange finished up 5 ringgit at 2,325 ringgit ($682) a ton.
The market touched an intraday high of 2,351 ringgit, a level not seen since November 1998.
Bulls are coming out with a vengeance after yesterday's numbers, said one trader. There is a shortage of supplies and people are getting desperate to get hold of whatever CPO is available in the market. But some dealers said the market is ripe for correction after making strong gains this week.
The palm oil market has gained almost 17 per cent this year after surging 40 per cent in 2006 on the back of demand from the biodiesel and food sectors.
Other traded contracts rose between 13 and 40 ringgit, except for January, March and November 2008, which fell on profit-taking. Overall trade jumped to 22,931 lots of 25 tons each, compared with around 12,000 lots that change hands on a routine day.
Malaysian Palm Oil Board said the country's April closing stocks fell 11.65 per cent to 1,181,320 tons, the lowest in almost three years.
The board said palm oil output in April rose 4.11 per cent, less than expected and exports showed a steady growth of 5.9 per cent.
Cargo surveyor Intertek Testing Services said Malaysian exports of palm oil products rose 8.1 per cent to 463,865 tons for May 1-10 from April 1-10.
In the physical market, crude palm oil for May shipment in the southern region was quoted at 2,460/2,480 ringgit a ton.
Deals were done between 2,450-2,460 ringgit a ton.—Reuters
