VEGOILS-Palm rises over Indonesia export control rumours

The Malaysian palm futures continued to rise on Tuesday, with rumours that Indonesia - the world's largest exporter - was considering new export controls. Dalian edible oil, which is stronger, also provided support.

At closing, the benchmark contract for palm oil delivery in August on Bursa Derivatives Exchange climbed 53 ringgit or 1.17% to 4,587 Ringgit per metric ton. The contract increased by as much as?2.23% during the afternoon session.

The main Indonesian index continued its week-long slump on Tuesday. Traders reacted to rumours about the government considering new export controls for strategic commodities including palm oil, in an effort to limit capital flow. Could not confirm the rumour.

The Kuala Lumpur trader stated that if the rumour is true, the demand would shift to Malaysia and support the price.

Dalian's palm oil contract grew 1.76%, while the most active soyoil contract climbed 1.67%. Prices for soyoil on the Chicago Board of Trade fell by 0.42%

As palm oil competes to gain a share in the global vegetable oils market, it tracks the price movement of its rival edible?oils.

The Malaysian Palm Oil Council stated that the price of crude?palm oils is expected to remain around 4,400 Ringgit ($1,110), per metric ton, in June, as global biofuel policies are supporting demand and weather risks add to supply uncertainty.

Palm oil may test its resistance at '4,584 ringgit/metric ton. A break above this could lead to the range of 4,634-4,669 ringgit.

(source: Reuters)