Breaking News

Tweet TWEET

Palm Oil Rallies as U.S. Data Boosts Commodity Demand Prospects

Palm oil climbed to the highest level in more than two weeks after data signaled a recovery in the U.S. economy, boosting prospects for cooking oil demand.

The contract for March delivery climbed as much as 3.1 percent to 2,392 ringgit ($781) a metric ton on the Malaysia Derivatives Exchange, the highest price for the most-active contract since Dec. 3, and ended the morning session at 2,391 ringgit. Futures have gained 5.1 percent this week and are heading for a 25 percent drop this year.

The U.S. economy grew at a 3.1 percent annual rate in the third quarter, more than previously reported, according to Commerce Department figures released yesterday. Sales of previously owned U.S. homes climbed to a three-year high in November, reinforcing forecasts that the industry is set to add to annual economic growth for the first time since 2005.

“Commodities may receive a boost as the global sentiment may improve because of the positive economic data from the U.S.,” Chowda Reddy, an analyst at JRG Wealth Management Ltd., said by phone from the Indian city of Hyderabad.

Futures also gained as some investors reversed bets on declining prices ahead of year-end holidays, Paramalingam Supramaniam, director at Pelindung Bestari Sdn. Bhd., said by phone from Kuala Lumpur.

Soybeans for March delivery climbed 1 percent to $14.185 a bushel on the Chicago Board of Trade. Soybean oil for delivery in March advanced 1.2 percent to 48.88 cents a pound.

Palm oil for May delivery gained 0.3 percent to 6,760 yuan ($1,085) a ton on the Dalian Commodity Exchange. Soybean oil for May was little changed at 8,590 yuan a ton.

To contact the reporter on this story: Swansy Afonso in Mumbai at safonso2@bloomberg.net

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.