Palm oil advanced to the highest level in more than five weeks after the U.S. Congress voted to end a 16-day government shutdown, and as rising Malaysian exports signaled growing demand.
The contract for delivery in January rose as much as 1 percent to 2,432 ringgit ($769) a metric ton on the Bursa Malaysia Derivatives, the highest level for most-active futures since Sept. 9, and was at 2,421 ringgit at 11:47 a.m. in Kuala Lumpur. Palm for physical delivery in November was at 2,400 ringgit yesterday, data compiled by Bloomberg show.
The U.S. Congress yesterday voted to halt the government shutdown and raise the debt limit, ending the nation’s fiscal impasse. Exports from Malaysia, the largest producer after Indonesia, gained 12 percent to 799,853 tons in the first 15 days of October from a month earlier, SGS (Malaysia) Sdn. said yesterday.
“The resolving of the whole U.S. issue will be positive for commodities because it removes the negative sentiment from world economies,” said Tan Chee Tat, an analyst at Phillip Futures Pte. in Singapore. “The strong export demand as shown by the cargo surveyors helped to alleviate some of the earlier concerns over strong production in the upcoming months.”
Exports climbed for a fourth month in September, while output gained 10 percent to 1.91 million tons, according to data from the Malaysian Palm Oil Board. Production is typically highest from July to October each year.
Soybeans for delivery in November gained 0.2 percent to $12.7925 a bushel on the Chicago Board of Trade, while soybean oil for December climbed 0.8 percent to 41.71 cents a pound.
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