KUALA LUMPUR, Aug 21: Malaysian crude palm oil futures jumped 3.1 per cent on Thursday, hitting an eight-day high as crude oil gave a leg up to vegetable oil markets.

Palm oil has dropped about 13 per cent this year on high stocks and recent news of defaults from key buyers India and China.

But two straight days of gains for palm oil have rekindled some trading interest, led mostly by European buyers, dealers said.

The benchmark November contract on the Bursa Malaysia Derivatives Exchange rose as much as 81 ringgit to 2,672 ringgit ($800) per ton, a level unseen since August 12.

The contract then settled up 62 ringgit at 2,653 ringgit.

Buying interest in India, the world’s second-largest vegetable oil consumer, has revived with traders making enquiries for crude palm oil at $850 per tonne on a cost and freight (C&F) basis.

Other traded months on the Bursa Malaysia Derivatives Exchange rose between 55 and 80 ringgit. Overall volume stood at 11,652 lots of 25 tonnes each.

There has been quite a bit of European buying interest because palm oil had fallen much more than soyaoil and the differential is quite significant, said a Malaysian trader.

Crude oil prices rose above $116. The most-active January 2009 soyaoil contract on China’s Dalian Commodity Exchange jumped 3.7 per cent, while September soyaoil in the United States climbed 1.3 per cent.

Exports of Malaysian palm oil products for August 1-20 rose as much as 8.4 per cent to 904,645 tons, cargo surveyors reported on Wednesday.

Indonesian palm oil prices rose on Thursday, tracking gains in the Malaysian market. In Jakarta, the state marketing centre sold crude palm oil at 6,896 rupiah ($0.754) a kg, up from 6,635 rupiah a kg on Wednesday.

In Jakarta, refiners offered refined, bleached, deodorised (RBD) palm olein -- used as cooking oil -- at 7,400 up from 7,200 rupiah a kg on Wednesday.

In the physical market in Malaysia, crude palm oil for delivery in August and September was called at 2,650/2,660 ringgit a ton in southern region. Trades were done between 2,630 and 2,650 ringgit.—Reuters