Palm oil advances to one-week high

Palm oil climbed to the highest level in more than a week on rising
demand from China, the second-largest importer, amid speculation that a
delay in soybean planting in the US will lower global cooking oil
supplies.


The contract for July delivery advanced as much as 1.5 per cent to
RM2,294 a metric tonne on the Bursa Malaysia Derivatives, the highest
price for the most-active contract since April 30, and ended the morning
session at RM2,289 in Kuala Lumpur. Futures, down 6.1 per cent this
year, reached RM2,230 on May 6, the lowest price since December 13.


China imported 770,000 tonnes of vegetable oils in April, the
customs agency said. That compares with 700,000 tonnes in March and
510,000 tonnes a year ago, according to Bloomberg data. Global palm oil
exports are forecast to climb to 43.6 million tonnes in 2012-2013 from
40.4 million tonnes in 2011-2012, Hamburg-based researcher Oil World
said yesterday.


Chinese purchases and gains in soybeans are boosting palm oil, Donny
Khor, deputy director of futures and commodities at RHB Investment Bank
Bhd, said by phone from Kuala Lumpur. "The US weather and the delay in
soybean planting are also supporting prices."






About two per cent of soybeans in the US were planted as of May 5, down
from 22 per cent last year and the five-year average of 12 per cent, the
Department of Agriculture said. Farmers who plant soybeans after
collecting wheat may not be able to plant oilseeds this year because of
the harvest delays.


Soybeans for July delivery gained 0.5 per cent to US$13.8875 a bushel on the Chicago Board of Trade.


Soybean oil climbed 0.5 per cent to 49.37 cents a pound.


Refined palm oil for September delivery gained 1.4 per cent to 5,988
yuan (US$975) a tonne on the Dalian Commodity Exchange. Soybean oil for
same month delivery climbed 0.5 per cent to 7,396 yuan a tonne.--
Bloomberg