KUALA LUMPUR, July 15: Malaysia crude palm oil futures rose 0.7 per cent on Tuesday as players looked beyond dismal export data from cargo surveyors, saying overseas demand will recover soon due to the looming Asian festive season.

Palm oil -- used in products from soaps to biofuel – is trading about 21 per cent below a record high hit in early March of 4,486 ringgit a tonne on account of recent sluggish demand and record inventory levels.

But traders said tightness in U.S. soybean and soyaoil stocks were supportive for palm oil markets, as some demand may switch over to palm oil along with long-waited Asian festival demand.

The benchmark September contract on the Bursa laysia Derivatives Exchange settled up 26 ringgit at 3,550 ringgit ($1,103) per tonne.

A confirmation on incoming festival demand can be made after the first 20 and 25 days export numbers. The market is really betting on this, said a trader with a local commodities broker.

Buyers in China, India and Middle East nations tend to stock up at least two months before the Asian festival season begins in early September.

Other traded months rose between 8 and 80 ringgit. Overall traded volumes rose to 12,879 lots of 25 tonnes from the usual 10,000 lots.

So far, exports have been disappointing.

August soyaoil rose 0.7 per cent, while the most active January 2009 soyoil contract on China’s Dalian Commodity Exchange also inched higher.

The state marketing centre in Jakarta sold crude palm oil at 9,077 rupiah a kg, up from 9,052 rupiah a kg on Friday.

The centre which sells palm oil from state plantations failed to sell any crude palm oil in its auction Monday.

Demand in the local market is still healthy. Market is active today as gains in Malaysia drew players back to the market said a dealer in a plantation firm in Medan.

In Jakarta, refiners offered refined, bleached, deodorised (RBD) palm olein used as cooking oil--at 9,200 rupiah a kg, unchanged from Monday.

In Malaysia’s physical market, crude palm oil for July shipment in the southern region was quoted at 3,550/3,560 ringgit a tonne. Trades were done between 3,530 and 3,550 ringgit.

—Reuters