Palm oil futures in Malaysia, the global benchmark, rose to match a record after erasing Tuesday’s losses amid expectations that demand for vegetable oil for cooking and alternative fuel will increase.
Palm oil for March delivery rose as much as 27 ringgit, or 0.9%, to 3,188 ringgit (Rs38,238) a tonne on the Malaysia Derivatives Exchange in Kuala Lumpur. The contract traded at 3,174 ringgit.
Last year, palm oil rose 54% as investors speculated higher crude oil prices will force countries to increase the use of biodiesel made from the vegetable oil. Rising incomes are also boosting demand for fried food in China and India—the biggest consumers of edible oils. Crude oil rose for a second day on speculation that a government report on Wednesday will show US inventories declined for an eighth week. Oil reached a record $100 a barrel in New York for the first time on 2 January on concern violence in Nigeria may further lower output in Africa’s biggest oil producer.