KUALA LUMPUR, Oct 6: Malaysian palm oil surged one per cent on talk that Indonesia planned to restrict exports to ensure enough supply of oil at home for the fasting month of Ramazan, dealers said.

Malaysia is the world’s largest palm oil producer and exporter and would benefit from any cut in shipments by Indonesia, its biggest rival.

Thursday’s rumour could not be immediately verified. But higher prices paid for physical Malaysian palm oil by a regional trading house with refineries in Indonesia sparked a buying frenzy in futures, dealers said.

At the close, the benchmark third-month crude palm oil contract on Bursa Malaysia Derivatives, December, was up 15 ringgit at 1,482 ringgit ($393.85) a ton — one ringgit shy of the day’s high. Other traded months were up 17 to 20 ringgit.

Overall volume was 4,782 lots of 25 tons each — down from Wednesday’s 5,856 lots but four times the level seen on Thursday morning.

Indonesia is the world’s most populous Muslim country and Ramazn is its biggest festival.

Palm oil futures were up only slightly in Kuala Lumpur in the morning as players were hesitant about taking positions ahead of next week’s release of official crop and trade data for September.

The government-run Malaysian Palm Oil Board is scheduled to issue on Monday production, exports and closing stock numbers for September versus August. Its numbers usually move the market.

Two cargo surveyors watched by the market will issue export estimates for the first 10 days of October.

Soyaoil futures on the Chicago Board of Trade were also strong.

In physical crude palm oil, offers for October and November delivery from Malaysia rose 20 ringgit a ton.

Offers/bids closed at 1,490/1,480 ringgit a ton in the southern and central regions, versus Wednesday’s 1,470/1,465.

Trades for October stood at 1,475-1,480 ringgit and November at 1,480.—Reuters