KUALA LUMPUR, Dec 19: Malaysian crude palm oil futures rose 1.1 per cent to hit a three-week high on Wednesday, as concerns that rains and floods would affect production gripped the market.

But gains were cut as some investors took profits minutes before the close on the Indian Farm minister’s comment that there were no plans to cut import duties on edible oils.

Nevertheless, expectations of bullish export data due to be released by cargo surveyors on Friday kept the market on a steady uptrend, approaching an historic high of 3,068 ringgit hit in late November.

The benchmark March contract on the Bursa Malaysia Derivatives Exchange rose as much as 32 ringgit to stand at 2,982 ringgit ($890) a ton, a level not seen since Nov. 29.

The contract ended up 12 ringgit at 2,962 ringgit.

The excuse to liquidate was certainly there with no plans from India to cut import duties but at the same time, there are more excuses to take short-cover on the weather, strong exports and the holidays, said a head analyst with a local brokerage.

Refiners in Malaysia’s key palm-growing regions have been rejecting truckloads of fruit bunches that have turned rotten due to over-exposure to wet weather, traders said.

He was referring to the major palm-producing state of Johor in southern Malaysia, which contributes roughly 18-20 per cent of the country’s total palm oil output.

A total of 28 people have died so far in floods in Malaysia’s south and northeast states, where rising waters have driven more than 34,000 people from their homes and cut off roads, local media have reported.

Traders said the prospect of lower production will keep palm oil prices at a premium as buyers like China lock in supplies for the Lunar New Year festival due in February.

Exports for the first 20 days of December are expected to rise more than 940,000 tons, roughly 3-4 per cent higher than the same period in November, dealers said.—Reuters