KUALA LUMPUR, March 24: Malaysian crude palm oil futures rose 6.3 per cent on Monday as funds piled back into commodity markets after a sell-off last week, dealers said.

But investors later booked profits, pulling down palm oil prices to Friday’s closing levels despite expectations that India duty cuts on palm oil products last week will see the market turn up again.

Used in products ranging from cooking oil to biofuels, palm oil remains roughly 25 per cent lower than last month’s historic highs of 4,486 ringgit but has begun to turn up after India cut duties on crude and refined palm oils last Thursday.

The benchmark June contract on the Bursa Malaysia Derivatives Exchange rose as much as 211 ringgit to 3,541 ringgit ($1,103) a ton before settling up 10 ringgit at 3,340 ringgit.

The short-term outlook could be boosted by India’s move to cut palm oil import duties,” said Tee Sze Chiah, an analyst with Malaysian investment house Aseambankers, in a research note.

We reckon there are bargain hunting opportunities on the steep pullbacks.” Other traded months ranged between 119 ringgit drop to a rise of 205 ringgit. Overall trade shot up to 18,640 lots of 25 tons each from the usual 10,000 lots.

Malaysian palm oil futures fell by almost 10 per cent last week on a mix of weak vegetable oil markets, equity turmoil and fears of China defaulting on shipments.

Palm oil is now moving higher on an inflow of funds into US soyaoil and the general tightness in global oilseed stocks is generally supportive, said a trader with a local brokerage.

Exports of Malaysian palm oil products have been healthy for March 1-20, with cargo surveyors Societe Generale de Surveillance and Intertek Testing Services reporting increases of nearly 9 per cent to more than 824,000 tons.

Demand is bound to pick up in pace when China moves into the summer months, said another trader with a local brokerage.

In Malaysia’s physical market, crude palm oil for March shipment in the southern and central regions were quoted at 3,450/3,490 ringgit a ton. Trades were not quoted by the end of the session.—Reuters