Palm Oil Rallies as Malaysia Sets Zero Export Tax for February
Palm oil gained the most in more than a week after Malaysia, the world’s second-largest producer, said it will allow duty-free exports of the crude variety for a second month in February to boost shipments.
The contract for delivery in March climbed as much as 1.4 percent to 2,402 ringgit ($796) a metric ton on the Malaysia Derivatives Exchange, the biggest increase since Jan. 2, and ended the morning session at 2,387 ringgit in Kuala Lumpur. Futures fell 4 percent last week, the most since the five days ending Nov. 9.
Malaysia, which has a record inventory amid falling exports, has set the tax for shipment of crude oil at zero, Plantation Industries and Commodities Minister Bernard Dompok said in Kuala Lumpur today. The country changed its export-tax structure from Jan. 1 to reduce reserves. Stockpiles rose 2.4 percent an all-time high of 2.63 million tons in December from a revised 2.57 million tons a month earlier, according to the Malaysian Palm Oil Board.
“News that Malaysia is going to extend the zero export tax for February is positive for exports,” Chung Yang Ker, an analyst at Phillip Futures Pte., said from Singapore. “There has been a technical rebound after last week’s sharp loss.”
Exports dropped 25 percent to 373,462 tons in the first 10 days of January from a revised 499,732 tons in the first 10 days of December, Intertek said last week. Shipments retreated 34 percent, according to Societe Generale de Surveillance.
Soybeans for March delivery gained 1.3 percent to $13.905 a bushel on the Chicago Board of Trade. Soybean oil for delivery in March advanced 1.1 percent to 49.76 cents a pound.
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