Palm Oil Near Three-Month High on Outlook for Stockpile Decline
Jan. 12 (Bloomberg) – Palm oil futures in Kuala Lumpur, the global benchmark, climbed for a second day to near a three- month high on optimism today''s data from Malaysia may show stockpiles dropped from a record.
March-delivery palm oil advanced as much as 3.7 percent to 1,991 ringgit ($557) a metric ton on the Malaysia Derivatives Exchange, after gaining 10 percent last week, the most in six weeks. The commodity traded at 1,985 ringgit at 11:26 a.m.
``We believe the crude palm oil price has bottomed at 1,500 a ton and the recent recovery in price'''' is sustainable, analyst Fiona Leong of AMResearch Sdn. in Kuala Lumpur said in a report.
The commodity is the world''s cheapest cooking oil, and a substitute for soybean oil. Prices have gained for three weeks, the longest stretch since the period ended May 23.
Palm oil may average 2,000 ringgit a ton in 2009, 18 percent higher than previously forecast, Leong said. That compares with an average 2,852 ringgit in 2008.
China, the largest consumer of vegetable oils, marks the lunar New Year at the end of this month when families travel to reunite and share communal meals, which may lift demand.
Shipments from Malaysia, the second-largest producer of palm oil, jumped 25 percent to 1.65 million tons in December from November, the most in three months, Intertek said Jan. 2.
Malaysia''s palm oil stockpiles climbed to a record 2.27 million tons in November. December data is scheduled at midday.
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