(Updates with closing prices)
By Mei Mei Chu
KUALA LUMPUR, Jan 30 (Reuters) - Malaysian palm oil
futures on Monday closed at their highest in nearly three weeks
on concerns over output, following flooding in the world's
second largest producer.
The benchmark palm oil contract for April delivery
on the Bursa Malaysia Derivatives Exchange gained 28, or 0.72%,
to 3,930 ringgit ($926.45) a tonne. The contract rose for a
third straight session to close at its highest since Jan. 10.
Farmers in Malaysia's southern state of Johor are worried
that stagnant flood waters would affect their palm oil yields,
after heavy rains last week displaced thousands of people in
several palm oil producing states, according to state news
agency Bernama.
Chinese markets opening sharply higher after the Lunar New
Year holidays and talks about Indonesia further reducing its
domestic palm oil sales ratio also supported prices, said
Anilkumar Bagani, research head of Mumbai-based vegetable oils
broker Sunvin Group.
Dalian's most-active soyoil contract rose 1.5%,
while its palm oil contract gained 1.8%. Soyoil prices
on the Chicago Board of Trade were up 1.4%.
Palm oil is affected by price movements in related oils as
they compete for a share in the global vegetable oils market.
Oil fell, giving up earlier gains, as looming interest rate
hikes by major central banks and signs of strong Russian exports
offset rising Middle East tension over a drone attack in Iran
and hopes of higher Chinese demand. Weaker crude oil futures make palm a less attractive option
for biodiesel feedstock.
($1 = 4.2420 ringgit)
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(Reporting by Mei Mei Chu; Editing by Subhranshu Sahu and Vinay
Dwivedi)
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