KUALA LUMPUR, July 6: Malaysian crude palm oil futures ended 1.5 per cent higher on Friday as prices of rival soybean oil jumped in electronic trading and players covered positions ahead of the weekend.
Dealers said the market was looking forward to key production and export data from the industry regulator and cargo surveyors next week.
The benchmark September contract on the Bursa Malaysia Derivatives Exchange settled up 38 ringgit to 2,520 ringgit ($731) a ton.
Soyaoil has been moving up on weather conditions and this has pushed up palm oil, said a leading trader. Players were prompted to take up positions after a leading trading company started buying forward month contracts. Other traded months rose between 2 and 43 ringgit in overall trade of 10,706 lots of 25 tonnes each.
It is anyone's guess how demand and supply fundamentals will play out in July, so next week's data will be watched very carefully, said another trader.
June exports, stocks and output numbers will be released by
the Malaysian Palm Oil Board Tuesday and cargo surveyors Intertek Testing Services and Societe Generale de Surveillance will release export data for the first 10 days in July on the same day.
Palm oil is nearly 9 percent off a historic high of 2,764 ringgit reached in June as fears of swelling stocks due to weakening exports persist.
But industry officials say palm oil demand should pick up from July as nations from South Asia to the Middle East lock in supplies for the Muslim fasting month of Ramazan which is due in September.
Chicago Board of Trade soybean futures closed higher Thursday but retreated from early highs amid worries about heat and dryness moving into the US Midwest this week.Soyaoil closed 0.29 to 0.42 cent per lb firmer, with July up 0.32 cent at 36.68 cents.
In electronic trading during Asian hours on Friday, the contract jumped 0.63 per cent to 36.91 cents per lb by 1116 GMT.
Malaysian palm oil tracks the US soyaoil market because both commodities are used in products ranging from chocolates to lipstick and biodiesel.
September palm oil on Singapore's Joint Asian Derivatives Exchange jumped nearly 2 per cent to $736 a tonne in light trade.
In Malaysia's physical market, crude palm oil for July shipment in the southern region was quoted at 2,635/2,640 ringgit a tonne. Trades were done between 2,620 and 2,635 ringgit.—Reuters