JAKARTA, July 24: Malaysian crude palm oil futures rose 2.8 per cent on Thursday on short-covering after hitting an 8-month low the previous day and as investors bet on a recovery in exports to soak up a build up in stocks, dealers said.

Palm oil -- used in products ranging from soap to biofuel -- is nearly 31 per cent below a record high hit in early March of 4,486 ringgit a ton.

The benchmark October contract on the Bursa Malaysia Derivatives Exchange settled up 86 ringgit or 2.84 per cent at 3,113 ($957) ringgit a ton.

The contract fell 225 ringgit to 3,027 ringgit a ton on Wednesday, the lowest since Dec. 24 as profit-taking in crude oil swept through allied vegetable oil markets.

Some short-covering helped sustain the market. Also the direction is pointing towards a promising export number for this month,” a dealer in a local brokerage firm said.

Players estimated exports from July 1-25 would range between around 1.15 million tons and the full month exports may hit 1.3 million tons, the dealer said.

That will be good enough to wipe out a little of the stocks together with domestic stocks, the dealer said.

Other traded months rose between 25 ringgit and 131 ringgit higher. Overall volume was 11,610 of 25-ton lots.

Firm crude oil and soyoil also lent support to the palm oil market, dealers said.

But the contract was up 0.58 cent per lb at 59.13 cents per lb during Asian trade on Thursday.

Crude oil steadied on Thursday after tumbling to a six-week low on Wednesday, when a US government report showed large oil product stock builds that reinforced concern of weakening US demand.

Malaysia did gain today but not enough to cover the losses on Wednesday, said a dealer in a plantation firm in Medan.

In Jakarta, the state marketing centre only managed to sell 1,000 tons out of 7,000 tons of crude palm oil offered in its auction, at 8,062 rupiah a kg, free on board P. Baai in Sumatra island.

In the physical market in Malaysia, July/August crude palm oil was offered at 3,150-3,200 ringgit in the southern region and 3,120-3,150 ringgit in the central region.—Reuters