Palm oil advanced for a fifth day to a two-week high on speculation that a weakening Malaysian currency may spur demand for ringgit-denominated futures.
The contract for April delivery climbed as much as 0.4 percent to 2,597 ringgit ($781) a metric ton on the Bursa Malaysia Derivatives, the highest level for most-active futures since Jan. 6, and ended the morning session at 2,593 ringgit. The gain pared losses to 2.5 percent this year.
The Malaysian currency touched 3.3358 per dollar today, the weakest since Aug. 28. The ringgit fell 6.7 percent in 2013 and has lost 1.6 percent this year, according to data compiled by Bloomberg. Palm oil’s discount to soybean oil, a substitute in food and fuel uses, widened to $65.34 a ton today from $64.78 yesterday, data compiled by Bloomberg show.
“If you are a foreign buyer, it looks more attractive than soybean oil,” Benny Lee, a market strategist at Jupiter Securities Sdn., said by phone in Kuala Lumpur. “The 2,500 ringgit levels are really good buying levels.”
Exports from Malaysia, the second-biggest shipper, fell 15 percent to 748,303 tons in the first 20 days of January from the same period a month earlier, Intertek, a surveyor, said Jan. 20. That was less than the 28 percent drop in the first half of the month, Intertek data showed.
Soybean oil for March delivery advanced 0.5 percent to 38.28 cents a pound on the Chicago Board of Trade. Soybeans gained 0.2 percent to $12.825 a bushel.
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