Palm oil advanced for a fourth day, trading near a three-month high, on speculation that Malaysian stockpiles will drop from a record as shipments expand after the second-largest producer set a zero export tax.
The contract for delivery in April gained as much as 1.4 percent to 2,592 ringgit ($835) a metric ton on the Malaysia Derivatives Exchange, before trading at 2,577 ringgit at 12:22 p.m. in Kuala Lumpur. Prices reached 2,593 ringgit on Jan. 31, the highest level for the most-active contract since Oct. 25.
Exports from Malaysia climbed 11 percent to 1.46 million tons in January from a year earlier, according to data from Intertek on Jan. 31. Malaysia has maintained the zero-tariff policy for a second month in February, while Indonesia, the biggest producer, raised taxes on crude exports to 9 percent from 7.5 percent. Palm oil has rallied 16 percent from the close on Dec. 13, the lowest settlement since November 2009.
Investors are “speculating exports are going to be higher this next one or two months,” Benny Lee, a market strategist at Jupiter Securities Sdn., said by phone in Kuala Lumpur. India and China, the biggest users, were expected to buy, he said.
Lower production will also help to draw down inventories, which were estimated at 2.5 million to 2.6 million tons last month, with steeper falls seen in February and March, Sebastian Tobing, an analyst at UBS AG in Indonesia, wrote in a report dated Jan. 31. Inventories reached a record 2.63 million tons at the end of December, according to the Malaysian Palm Oil Board. Output is typically lowest in the first two months of the year.
Refined palm oil for delivery in September gained as much as 0.7 percent to 7,252 yuan ($1,164) a ton on the Dalian Commodity Exchange, the highest price for the most active contract since Oct. 26, before trading at 7,230 yuan at 11:30 a.m. Soybean oil for delivery in the same month rose 0.7 percent to 8,914 yuan a ton.
Soybeans for March delivery climbed 0.6 percent to $14.83 a bushel on the Chicago Board of Trade, while soybean oil for March delivery gained 0.7 percent to 53.35 cents a pound.
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