Palm rises on supply concern, strong demand, set to post weekly gain
Update prices, add analyst comments
JAKARTA, Aug 23 (Reuters) -Malaysian palm oil futures climbed for a third straight sessionon Friday to their highest in nearly three weeks as expectations of weak output in August and improving demand underpinned the contract.
The benchmark palm oil contract FCPOc3 for November delivery on the Bursa Malaysia Derivatives Exchange gained 15ringgit, or 0.39%, to 3,841 ringgit ($877.34) a metric ton by the midday break.
For the week the contract has gained 4.35%, its biggest weekly gain since May-end.
"Preliminary Aug. 1-20 production figures by Malaysian Palm Oil Association are not so encouraging, we are not seeing a double-digit growth in production," said Paramalingam Supramaniam, a director at Selangor-based broker Pelindung Bestari.
Indonesia's plan to raise the biodiesel blend to 40% in January from the current 35% and improving demand from major buyer China and India also supporting the price, he added.
"We saw a lot of interest by China yesterday, they bought a lot of December cargo. A lot of activities in India yesterday, they also bought a lot of cargo. Overall looks like demand is coming back again to Palm oil," he said.
Dalian's palm oil contract DCPcv1 gained 1.11%, while the most-active soyoil contract DBYcv1 was up 0.19%.Soyoil prices on the Chicago Board of Trade BOc2 rose 0.28%.
Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.
Exports of Malaysian palm oil products for Aug. 1-20 fell between 16.7% and 18.4% from a month earlier, data from cargo surveyors Societe Generale de Surveillance (SGS), Intertek Testing Services and AmSpec Agri Malaysia showed.
($1 = 4.3780 ringgit)
Reporting by Bernadette Christina; Editing by Janane Venkatraman
For a table on Malaysian physical palm oil prices, including refined oil, Reuters Terminal users can double click on or type OILS/MY01.
* To view freight rates from Peninsula Malaysia/Sumatra to China, India, Pakistan and Rotterdam, please key in OILS/ASIA2 and press enter, or double click between the brackets.
* Reuters Terminal users can see cash and futures edible oil prices by double clicking on the codes in the brackets: To go to the next page in the same chain, hit F12. To go back, hit F11.
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