Palm oil advanced for a second day to the highest level in almost one week after China, the world’s largest consumer of cooking oils, showed signs of recovery as industrial production and retail sales accelerated in September.
The contract for January delivery jumped 1 percent to 2,496 ringgit ($822) a metric ton on the Malaysia Derivatives Exchange in Kuala Lumpur, the highest price at close since Oct. 12. Futures have plunged 21 percent this year as stockpiles increased and a slowdown curbed demand from Europe and China.
Industrial production, retail sales and fixed-asset investment expanded at a faster rate, reducing the urgency for added stimulus. Gross domestic product grew 7.4 percent in the third quarter from a year earlier, matching the median estimate in a Bloomberg News survey of 43 economists. The Communist Party begins a once-a-decade leadership transition next month.
“Everybody’s waiting for the handover of power to see whether they’ll come up with a new stimulus package to boost the economy,” Carey Wong, an analyst at OCBC Investment Research Pte., said by phone from Singapore. “That potentially could have a spillover effect on consumption and nowadays palm oil is used more and more in processed food.”
Soybean oil for December delivery advanced 0.9 percent to 51.51 cents a pound on the Chicago Board of Trade. Soybeans for November delivery increased 1.3 percent to $15.2875 a bushel.
Palm oil for January delivery gained 1 percent to end at 6,950 yuan ($1,112) a ton on the Dalian Commodity Exchange. Soybean oil for delivery in May climbed 0.7 percent to close at 9,250 yuan a ton.