Palm gains more than 2% tracking stronger U.S. soyoil

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KUALA LUMPUR/JAKARTA (June 13): Malaysian palm oil futures jumped more than 2% on Thursday, supported by overnight gains in U.S. soyoil on the Chicago Board of Trade (CBOT).  

The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange closed up 2.1% at 2,009 ringgit (US$482.35) per tonne.

Although the contract reversed Wednesday's 1.9% fall, it is still on track to post a weekly loss, currently down 0.9% on weaker soyoil prices and concerns of slowing export demand.

Malaysian palm oil shipments dived more than 30% between June 1-10, versus the corresponding period last year.

"Overnight gains in soy added strength to boost palm oil's market sentiment," said a Kuala Lumpur-based futures trader.

Soybeans had gained for a fourth consecutive session, as forecasts of more rains in the U.S. Midwest threatened to stall planting.

Meanwhile, the launch of a road test for biodiesel with 30% palm content in the world's top producer Indonesia also helped sentiment, the trader added.

"If that exercise is effective, it will be good for the market. Anything that will absorb palm supply is good for the market."

Indonesia started testing of B30 fuel in cars on Thursday, as it gears up for its mandatory use in 2020.

In other related oils, the September soyoil contract on the Dalian Commodity Exchange rose 0.2% and the Dalian September palm oil contract was up slightly.

Palm oil prices are affected by movements in related edible oils, with which it competes for global market share.    
 Palm, soy and crude oil prices at 1050 GMT   
 Contract        Month  Last    Change  Low     High    Volume
 MY PALM OIL     JUN9     1928     -23    1928    1980      40
 MY PALM OIL     JUL9     2005      39    1987    2014    2928
 MY PALM OIL     AUG9     2009      41    1983    2021   24494
 CBOT SOY OIL    JUL9    27.65    0.09    27.5    27.8    9529
 INDIA PALM OIL  JUN9    499.3     4.4   494.1   500.3     940
 INDIA SOYOIL    JUN9      755    4.45   750.1   755.3    4920
 NYMEX CRUDE     JUL9    52.62    1.48   50.92   53.11  295714

 Palm oil prices in Malaysian ringgit per tonne
 CBOT soy oil in U.S. cents per pound
 Dalian soy oil and RBD palm olein in Chinese yuan per tonne
 India soy oil in Indian rupee per 10 kg
 Crude in U.S. dollars per barrel
(US$1 = 4.1650 ringgit)
(US$1 = 69.5425 Indian rupees)
(US$1 = 6.9208 Chinese yuan renminbi)