KUALA LUMPUR, April 30: Malaysian crude palm oil futures rose 1.4 per cent on Wednesday, after diving to a near three-week low, on higher vegetable oils and short-covering before a holiday.

Palm oil prices, which have meandered for the past two weeks, are weakening due to a mix of factors, including cuts in Indonesian export taxes, a firmer ringgit against the dollar and dismal Asian demand, though some traders say a recovery might be on the cards.

The benchmark July contract on the Bursa Malaysia Derivatives Exchange rose 46 ringgit or 1.4 per cent to 3,395 ringgit ($1,076) per ton, after settling the day before at 3,349 ringgit, a level unseen since April 10.

The Malaysian palm oil market will be closed on Thursday for the Labour day holiday, prompting some investors to cover their shorts in anticipation of stronger US soyaoil overnight.

Palm oil’s losses were a little overdone yesterday and traders are now using soyoil’s gains and the holidays to take up some speculative positions, said a trader with a foreign broker.

Other traded months rose between 13 and 40 ringgit . Overall trade fell to 6,661 lots of 25 tons each from the usual 10,000 lots.

Another trader said: Unless there is a strong growth in exports or some drastic weather situation, palm oil markets will be rather sluggish. Exports of Malaysian palm oil products for April rose 2 per cent to 1,286,454 tons from 1,261,295 tons shipped in March, cargo surveyor Intertek Testing Services said on Wednesday.

Malaysia’s April palm oil reserves will probably fall 1.7 per cent from March to its lowest level in four months, as higher demand for the edible oil outstrips a small rise in output, a Reuters poll showed on Tuesday.

In Malaysia’s physical market, crude palm oil for May shipment in the southern region was quoted at 3,390/3,420 ringgit a ton. Trades were done at 3,400 ringgit a ton.—Reuters