Palm Oil Gains for a Third Day, Longest Stretch in Three Months

Aug. 3 (Bloomberg) -- Palm oil futures gained a third day, the longest winning streak in three months, tracking advances in crude oil and soybeans.

Crude oil surged 9.6 percent in the past two trading days and extended gains in Asian trading today. Vegetable oils, which are used as biofuels, often track crude.

October-delivery palm oil soared as much as 4.3 percent to 2,284 ringgit ($651) a ton on the Malaysia Derivatives Exchange. Futures have gained 7.9 percent in three days, the longest such stretch of gains since the period ended May 4. The commodity paused at 2,279 ringgit at the midday break.

November-delivery soybeans surged as much as 5.1 percent in after-hours trading on the Chicago Board of Trade, extending last week’s 7.3 percent advance. It was at $10.17 at 12:26 p.m., the first time in a month that it’s above $10 a bushel.

The oilseed is crushed for meal for animal feed and oil for cooking, palm oil’s main substitute. Soybean oil ended last week with a 27 percent premium over palm oil, according to Bloomberg.

Investors are looking to record U.S. soybean harvest to make up for shortages caused by the drought in South America. The U.S., Brazil and Argentina are the largest growers of the oilseed.

“Soybean supply concerns are more prevalent,” said Ben Santoso, an analyst at DBSVickers Securities (Singapore), by telephone today. “Indiana is recording the coolest temperature in 112 years and crops are way behind schedule,” he said.